IREDA shares surge on renewable energy financing deal with Indian Overseas Bank

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IREDA shares surge on renewable energy financing deal with Indian Overseas Bank
Credit: © Reuters.

NEW DELHI - Shares of the Indian Renewable Energy Development Agency (IREDA) witnessed a significant uptick today, following the announcement of a memorandum of understanding (MoU) with the Indian Overseas Bank (NS: IOBK ). The collaboration is set to jointly finance renewable energy projects, aligning with India's commitments made at COP26 to ramp up non-fossil fuel-based electricity.

The market response to the partnership has been notably positive, with IREDA's stock price increasing by over 4% on the Bombay Stock Exchange (BSE) and over 5% on the National Stock Exchange (NSE). The shares reached highs of Rs 124.15 on the BSE and Rs 125.60 on the NSE.

The strategic alliance between IREDA and the Indian Overseas Bank is intended to bolster India's sustainable energy sector by facilitating the syndication and underwriting of loans for renewable energy projects.

Despite the surge in share prices and the promising outlook for renewable energy financing, some financial analysts remain cautious. They point to concerns regarding IREDA's earnings growth. This cautious stance by analysts signals that while the MoU has generated immediate market enthusiasm, there are underlying considerations that investors may need to monitor.

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