June 7, 2017 / 8:17 AM / 2 months ago

Cabinet approves plan for IREDA to go public

2 Min Read

A worker cleans photovoltaic solar panels inside a solar power plant at Raisan village near Gandhinagar, in Gujarat, February 11, 2014.Amit Dave/Files

NEW DELHI (Reuters) - The cabinet approved a plan on Wednesday to publicly list state-owned Indian Renewable Energy Development Agency (IREDA) to fund its ambitious renewable energy development programmes.

India, one of the world's largest greenhouse gas emitters, targets to raise its renewable energy generating capacity to 175 GW by 2022, and has reinforced its commitment to fight climate change even after President Donald Trump pulled the United States out of the Paris accord.

"Public issue of equity will enable IREDA to increase its equity base which will help them raise more debt resources for funding RE (renewable energy) projects," the government said in a statement.

IREDA will issue 13.9 million shares at 10 rupees each in an initial public offering, the government said, without giving a time frame.

It will also issue shares to its employees at a 5 percent discount, the government said, without specifying the number of shares to be issued to them.

IREDA is a non-banking financial institution which provides loans for the development of renewable energy projects, with interest from such loans accounting for over 80 percent of its revenue.

The company made a consolidated net profit of 2.23 billion rupees in the six months ended March 31, up about 47 percent from a year earlier. Revenue rose 52 percent to 86.1 billion rupees.

India's Cabinet, chaired by Prime Minister Narendra Modi, approved a plan last month to raise 23.6 billion rupees in bonds through IREDA for developing additional capacity in the renewable energy sector.

($1 = 64.4025 Indian rupees)

Reporting by Sudarshan Varadhan and Nigam Prusty; Editing by Subhranshu Sahu

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