IREDA Shares Advance as Strong Q3 Loan Disbursements Signal Momentum in Renewable Financing
Shares of Indian Renewable Energy Development Agency (IREDA) moved higher on Thursday, gaining around 2 percent, after the state-owned renewable energy financier reported robust growth in loan disbursements and sanctions for the third quarter of FY26. The provisional business update reinforced investor confidence in the company’s role as a key funding arm for India’s clean energy transition.
IREDA shares rose to Rs 142.30 apiece, extending gains for a second consecutive session, even as broader market sentiment remained selective in the opening days of the new calendar year.
Strong Q3 Performance Highlights Accelerating Disbursement Growth
In a stock exchange filing released after market hours on December 31, IREDA reported that loan disbursements during the October–November quarter stood at Rs 24,903 crore. This represents a sharp 44 percent year-on-year growth compared with Rs 17,236 crore disbursed in the corresponding period last year.
The surge in disbursements reflects sustained demand for financing across renewable energy segments, including solar, wind, hybrid power projects and allied green infrastructure.
Market participants viewed the data as a sign that project execution and financial closures in the renewable sector remain on track, despite tighter global financial conditions.
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Sanctions and Loan Book Show Broad-Based Expansion
Alongside higher disbursements, IREDA also reported strong growth in loan sanctions. Total loans sanctioned during the quarter rose 29 percent year-on-year to Rs 40,100 crore, compared with Rs 31,087 crore in the same period of the previous financial year.
The company’s overall loan book continued to expand at a healthy pace. As of the end of the quarter, IREDA’s outstanding loan book stood at Rs 87,975 crore, marking a 28 percent year-on-year increase from Rs 68,960 crore reported a year ago.
This steady expansion underscores IREDA’s growing footprint in financing renewable and energy-transition projects across the country.
Provisional Numbers, Final Figures Await Board Approval
IREDA clarified that the reported figures are provisional in nature and subject to audit. The final audited numbers will be released after consideration and approval by the company’s board.
“The provisional business update reflects strong operational momentum, with growth across disbursements, sanctions and the overall loan book,” the company said in its exchange filing.
Investors typically track these provisional updates closely, as they offer early insight into performance trends ahead of detailed quarterly financial results.
Renewable Push Continues to Support Lending Activity
Analysts say the strong quarterly numbers highlight the continued policy and execution push behind India’s renewable energy targets. With the government maintaining focus on clean energy capacity addition, green hydrogen, and grid-scale storage, financing requirements remain substantial.
IREDA, as a specialised public sector NBFC, plays a central role in channeling long-term capital to renewable developers, often acting as a catalyst for private sector participation.
Key drivers supporting lending growth include:
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Ongoing solar and wind capacity additions
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Hybrid and round-the-clock renewable power projects
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Government-backed clean energy initiatives
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Rising demand for refinancing of operational assets
These factors have helped sustain IREDA’s growth trajectory even amid global macro uncertainties.
Stock Performance Reflects Recent Correction
Despite the positive Q3 update, IREDA shares have seen pressure in recent months. The stock has declined around 1 percent over the past one month and more than 17 percent in the last six months.
On a calendar-year basis, IREDA shares fell about 36 percent in 2025, following a sharp rally of nearly 125 percent over the past five years. The correction has been attributed to profit booking, valuation concerns, and broader volatility in PSU and renewable energy stocks.
At current levels, the stock trades at a price-to-earnings ratio of about 25.17 and commands a market capitalisation of over Rs 39,525 crore.
Market Reaction Signals Focus on Fundamentals
The positive price reaction on Thursday suggests that investors are beginning to refocus on fundamentals after the recent correction. Strong disbursement growth and a rising loan book are seen as supportive of medium-term earnings visibility, provided asset quality remains stable.
Analysts note that while valuation comfort has improved after the stock’s decline, sustained upside will depend on execution, cost of funds, and the pace of project commissioning in the renewable sector.
Outlook: Growth Visibility Intact Amid Energy Transition
Looking ahead, IREDA’s business outlook remains closely tied to India’s clean energy ambitions. With renewable capacity targets continuing to expand and financing needs rising in tandem, the company is well positioned to benefit from long-term structural trends.
However, investors are expected to keep a close watch on asset quality, borrowing costs, and competition from private lenders as the sector evolves.
For now, the sharp rise in Q3 loan disbursements and steady growth in the loan book have provided a positive trigger for the stock, reaffirming IREDA’s role as a cornerstone of India’s renewable energy financing ecosystem.
