IREDA asset quality to be affected by Gensol Engineering exposure?

Shares of Indian Renewable Energy Development Agency (IREDA) Ltd. are trading with gains of over 2.5% on Thursday, March 6. This is the second day of gains for the stock. Wednesday was also the first time that the stock ended with gains after entering the Futures & Options segment.

The stock is in focus after ratings agency ICRA mentioned that the stock has exposure to Gensol Engineering, whose ratings have been downgraded by both ICRA and CARE Ratings due to delay in servicing its debt.

According to ICRA, IREDA has an exposure for a term loan worth ₹254.9 crore and additional working capital facilities worth ₹215.7 crore to Gensol, taking the total exposure to close to ₹470 crore.

The total exposure, as disclosed by ICRA, amounts to 0.7% of IREDA's total loan book, which stood at ₹68,960 crore at the end of the December quarter.

IREDA had reported gross NPA figures of 2.68% at the end of the December quarter from 2.19% in September, while net NPA had seen a deterioration to 1.5% from 1.04% at the end of the September quarter.

Shares of IREDA are already down 50% from their peak of ₹310, which they had surged to in 2024.

Two analysts have coverage on IREDA, where ICICI Direct has a "buy" rating with a price target of ₹250 crore, while Phillip Securities has a "sell" rating with a price target of ₹150.

Shares of IREDA are trading 2.4% higher at ₹150.8. The stock is down 20% over the last one month.