The Cabinet Committee on Economic Affairs approved the listing of Indian Renewable Energy Development Agency Ltd. on stock exchanges through an initial public offering—a move that will help in raising part of its funds for meeting growth plans.
The issue will include the sale of a part of the government's stake in the agency as well as an issue of fresh equity, according to an official statement released on Friday.
The current approval supersedes an earlier decision taken by the CCEA in July 2017 for allowing IREDA to issue 13.90 crore fresh equity shares of Rs 10 each on a book-building basis through the IPO. The recent decision was necessitated after the capital structure of IREDA changed in the wake of Rs 1,500-crore capital infusion by the government in March last year.
IREDA is a central public sector enterprise under the Ministry of New and Renewable Energy. Incorporated in 1987, it finances renewable energy and energy efficiency projects in India. The agency is registered with the RBI as a non-banking financial company.
The IPO will help IREDA "in raising a part of its capital requirement for meeting growth plans without depending on the public exchequer, and improve governance through greater market discipline and transparency arising from listing requirements and disclosures", the cabinet panel said.
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