IREDA’s Gross NPAs have Risen to 6%

In Clean Facts, Clean News, News, Renewable Energy, Solar, Wind

The Indian Renewable Energy Development Agency (IREDA)’s gross non-performing assets (NPAs) rose to 6.01 percent of its total assets in the financial year (FY) 2016-17. The net NPAs of IREDA for FY 2016-17 stood at ₹5 billion.

During the last three years, IREDA’s gross NPA has increased from 5.3 percent to 6.01 percent of their total assets. However, IREDA has been able to contain net NPA to a level of 3.77 percent as on March 31, 2017.

IREDA, being a dedicated non-banking financial company (NBFC) for financing renewable energy projects in the country, is required to finance renewable energy projects in the sector. During the last three years, the major focus areas of financing have been wind and solar sectors in line with the government of India’s target for installing 175 GW of renewable energy capacity by 2022.

The NPAs of IREDA are mainly in biomass, cogeneration, and small hydro and energy efficiency (EE) sectors. IREDA has already taken corrective action in this regard and stopped funding in biomass and EE sectors since the last three years.

IREDA has also decided that its exposure in small hydro and cogeneration shall not exceed 50 percent of the project cost as against 70 percent of the project cost earlier.

While the wind projects constitute 34.28 percent of IREDA’s loan portfolio, solar occupies approximately 25.12 percent of IREDA’s loan portfolio.

o increase its funding capacity for renewable energy projects, IREDA is all set for the launch of its Initial Public Offering (IPO).

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