Shares of Indian Renewable Energy Development Agency Ltd (IREDA) encountered a slight dip on Friday after registering a solid debut on Dalal Street on November 29, following its successful initial public offering (IPO).
IREDA shares were down 1.53 per cent at Rs 64.30 at around 12:20 pm. Even then, shares of the government-owned entity are trading at a 100 per cent premium over the IPO issue price of Rs 32. Therefore, individuals who acquired shares during the IPO of IREDA have seen their wealth double.
But with the recent dip, many IREDA shareholders are wondering whether they should hold on to their stakes for a longer term or book profits to exit with substantial gains.
Several analysts have pointed out that IREDA’s strong financial performance and focus on the renewable energy sector, which has become a prime focus in India and worldwide, positions it ideally for better growth in the future. This is in addition to the company’s robust fundamentals.
Shivani Nyati, Head of Wealth, Swastika Investmart Ltd, said, “IREDA’s strong financial performance and focus on the burgeoning renewable energy sector make it an attractive investment proposition.” Nyati added that the renewable energy sector in India is poised to witness significant growth in coming years, driven by government initiatives and increasing environmental concerns.
She further added that the company’s long-term prospects are promising and make it a “worthwhile investment” for those with a long-term investment horizon. Simply put, the company does have the potential to deliver greater returns over a longer period.
Market experts also believe that the strong IPO listing will boost demand for IREDA stock amongst all kinds of investors. Meanwhile, Prashanth Tapse of Mehta Equities also said that IREDA is a long-term opportunity and those who were allotted shares during the IPO should hold on for the long term.
Tapse also said those who failed to acquire IREDA shares during the IPO could accumulate them at every dip and hold them for a longer period for healthy returns.
(Disclaimer: The views, opinions, recommendations, and suggestions expressed by experts/brokerages in this article are their own and do not reflect the views of the India Today Group. It is advisable to consult a qualified broker or financial advisor before making any actual investment or trading choices.)