NSE Removes IREDA from Major Indices Due to SEBI Norm Violations

20 Mar 2024 , 10:12 AM

The NSE removed IREDA from numerous key indices due to the firm’s failure to comply with SEBI portfolio concentration standards.

The committee has decided to withdraw its previous decision to add IREDA, which was announced on February 28, 2024, since it violated one of the conditions of SEBI Portfolio Concentration Norms for Equity Exchange Traded Funds (ETFs) and Index Funds linked to impact cost,” according to a press statement from the NSE.

IREDA will thus no longer be included in the Nifty Midcap 150, Nifty 500, Nifty Midcap 100, Nifty 200, Nifty LargeMidcap 250, Nifty MidSmallcap 400, Nifty Total Market, and Nifty500 Multicap 50:25:25 indexes.

The decision was set to take effect on March 28, 2024; however, the counters that were omitted following IREDA’s admission will now remain in the indexes.

V-Guard Industries’ exclusion from the Nifty 500, Nifty Smallcap 250, and Nifty MidSmallcap 400 will be lifted, replacing IREDA.

“All other replacements announced on February 28, 2024 shall remain unchanged,” he stressed.

On March 19, IREDA shares fell 2.67% on the NSE to ₹129.6 per share. Over the last month, the counter has plummeted by more than 25%.

Since its listing on November 29, when the company was offered at a 56% premium, IREDA shares have increased by about 106%, more than tripling investors’ wealth.

In Q3FY24, IREDA recorded a 67.2% year-on-year increase in net profit to ₹335.5 Crore, owing to strong loan book growth and bad debt reduction. The non-banking financial institution under the Ministry of New and Renewable Energy saw its income rise 44.2% year on year to ₹1252.9 Crore, while EBITDA increased 51% to ₹1,154 Crore.

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