IREDA Raises ₹453 Crore as Perpetual Bond Issue Sees 2.69x Subscription

The Indian Renewable Energy Development Agency Limited (IREDA) announced on Thursday, September 11, that it has raised ₹453 crore through its second issue of perpetual bonds at a 7.70% annual interest rate.

The fundraising move is a major boost to the agency’s capital reserves, enabling it to expand financing for renewable energy projects across India.

IREDA Strengthens Capital Base with Fresh Fundraise

Strong Investor Response Highlights Market Confidence

The bond issue received an overwhelming response from investors, with total bids worth ₹1,343 crore against a base size of ₹100 crore and a green shoe option of ₹400 crore. The issue was oversubscribed 2.69 times, underscoring the growing investor trust in IREDA’s leadership role in India’s clean energy transition.

CMD’s Remarks on IREDA’s Milestone Fundraise

Pradip Kumar Das, Chairman and Managing Director of IREDA, said:

“These bonds will strengthen our tier-I capital and help scale up renewable energy financing, accelerating India’s transition to a greener and more sustainable future. I sincerely thank all the investors for their overwhelming response and continued trust in IREDA, which motivates us to deliver even greater value to the renewable energy ecosystem and the nation."

Key Features of IREDA’s Perpetual Bonds

What Are Perpetual Bonds?

Perpetual bonds are unique financial instruments with no fixed maturity or redemption date. They are callable only at the discretion of the issuer, giving companies flexibility in managing long-term capital.

IREDA’s Bond Structure

• Coupon Rate: 7.70% per annum

• Step-Up Clause: 50 basis points (bps) increase if the bond is not called after 10 years

• Seniority: Ranked senior only to share capital, these bonds act as hybrid securities, blending features of equity and debt.

• Capital Benefits: Strengthens IREDA’s tier-I capital base, providing stable and long-term funding to back India’s ambitious renewable energy targets.

Market Performance of IREDA Shares

Despite the fundraising success, shares of Indian Renewable Energy Development Agency Limited (IREDA) closed at ₹146.60, down ₹1 or 0.68% on the BSE on September 11. Analysts note that such short-term movements do not overshadow the positive long-term outlook, given IREDA’s role in financing India’s expanding renewable sector.

Significance for India’s Renewable Energy Push

Scaling Renewable Energy Financing

This bond issuance comes at a critical time as India accelerates efforts to meet its 500 GW renewable energy capacity target by 2030. With robust investor backing, IREDA is poised to increase credit support to solar, wind, hydro, and green hydrogen projects.

Confidence in India’s Green Growth Mission

The oversubscription of the bonds reflects global and domestic investor confidence in India’s energy transition roadmap, led by initiatives such as the National Green Hydrogen Mission and the government’s continued focus on energy security and decarbonization.

About IREDA

The Indian Renewable Energy Development Agency (IREDA) is a public sector enterprise and a Non-Banking Financial Company (NBFC) under the administrative control of India's Ministry of New and Renewable Energy (MNRE). Founded in 1987, its primary objective is to promote, develop, and provide financial assistance for projects related to renewable energy (RE) and energy efficiency/conservation. Its motto is "Energy for Ever."

Key Functions and Objectives

IREDA acts as a specialized financial institution for the green energy sector. Its main functions include:

• Financing RE Projects: It provides loans and financial products for a wide range of RE projects, including solar, wind, hydropower, biomass, and waste-to-energy.
• Promoting Innovative Financing: It develops unique financial schemes to meet market needs and increase the flow of capital into the renewable energy sector.
• Supporting Energy Efficiency: The agency also finances projects that focus on energy efficiency and conservation to reduce overall energy consumption.

• Advisory Role: IREDA provides project management, consultancy, and advisory services to support the development and implementation of RE projects.

Role in India's Renewable Energy Sector

IREDA has been a key driver in India's transition to a green economy. It provides crucial financial support that a conventional bank might not, helping to bridge the gap between project developers and large-scale funding. The agency has been instrumental in funding major projects, including large-scale solar parks, wind farms, and hydropower plants.

Conclusion

IREDA’s successful ₹453 crore perpetual bond issuance marks another step forward in strengthening India’s renewable energy financing ecosystem. With an oversubscription of 2.69 times, the response highlights strong investor faith in IREDA’s strategic role as a premier financier of clean energy. Backed by its growing capital base, IREDA is well-positioned to accelerate India’s journey towards a sustainable, low-carbon future.