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IREDA Q1 FY26 Profit Drops 35% YoY Amid Asset Quality Deterioration

The Indian Renewable Energy Development Agency (IREDA), a Navratna PSU, reported a 35.1% year-on-year decline in net profit for Q1 FY26, posting Rs246.68 crore compared to Rs383.7 crore in the same quarter last year. Despite a nearly 29% rise in revenue from operations to Rs1,947.29 crore, total expenses surged 37% to Rs1,654.9 crore, impacting profitability.

The key concern in IREDA’s quarterly results was a significant deterioration in asset quality. A major contributor was the classification of loans worth nearly Rs730 crore to Gensol Engineering as non-performing assets (NPAs). This development led to a negative market reaction, with IREDA’s stock falling up to 5% on July 11, following the release of the results after market hours on July 10.

The weak asset quality has raised investor concerns despite the robust revenue performance. IREDA’s growing loan book is facing rising credit risks amid an expanding renewable energy sector. Analysts expect the PSU to focus on recovery strategies and better risk management, especially in light of the government’s renewable push, where IREDA plays a crucial financing role.