IREDA is not stopping. With last 2 days of surge in IREDA, IREDA is now trading at 26.5x and REC at 8.5x.
A premium of 3x justified for financing small renewable setups? I guess financing small projects will have higher administrative cost (people on ground to verify project setup, IT initiatives to support retail disbursements etc).
With REC venturing into infrastructure development loans too, they will have higher loan book which will translate to higher EPS too.
This gap of 3x in PE valuation is a balloon, IREDA should command a premium, but 200% is way too high, premium of 20-40% is justified.
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