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Business Standard
3 days ago
- Business
- Business Standard
IREDA bonds get tax-exempt status, helping investors save on capital gains
Bonds issued by the Indian Renewable Energy Development Agency Ltd (IREDA) will be regarded as 'long-term specified assets' to allow individual investors to claim tax exemption on capital gains. Exemption under Section 54EC of the Income Tax Act applies to IREDA bonds redeemable after five years and issued on or after July 9 this year, according to a notification issued by the Central Board of Direct Taxes. Tax-saving potential for investors Under Section 54EC, individuals earning long-term capital gains (LTCG) can save tax by investing the gains in specified bonds within six months of the asset sale. The maximum investment limit is Rs 50 lakh in a financial year. This notification means that IREDA bonds now join the list of other tax-saving bonds eligible under Section 54EC. For investors, this presents another option to defer or avoid paying LTCG tax, while contributing to renewable energy development. Boost for renewable energy projects According to IREDA, proceeds from the bonds will be deployed exclusively for renewable energy projects that can service their debt independently, without relying on state governments. 'This recognition by the government reinforces IREDA's pivotal role in accelerating renewable energy financing in the country,' said Pradip Kumar Das, chairman and managing director, IREDA. 'The tax-exempt status for our bonds will offer an attractive investment avenue while ensuring increased capital availability for green energy projects, contributing to India's 500 GW non-fossil fuel capacity target by 2030,' he said. This move is expected to attract wider participation from investors seeking safe, tax-saving instruments. For those planning to reinvest long-term capital gains, IREDA bonds now provide an opportunity to save tax while backing India's transition to clean energy. Financial planners, however, advise investors to assess their liquidity needs before committing to these bonds that come with a lock-in period of five years.
Mint
3 days ago
- Business
- Mint
IREDA net profit falls 36 pc to ₹247 cr in June quarter
New Delhi, Jul 10 (PTI) State-owned Indian Renewable Energy Development Agency on Thursday reported a 36 per cent decline in its net profit to ₹ 247 crore in the June quarter compared to a year ago, mainly due to higher expenses. The company had posted a net profit of ₹ 384 crore in the quarter ended on June 30, 2024, a BSE filing showed. However, the revenue from operations improved to ₹ 1,947 crore during the quarter against ₹ 1,510 crore in the year-ago period. The total expense rose to ₹ 1,655 crore in the quarter from ₹ 1,034.96 crore in the same period a year ago. The financing cost climbed to ₹ 1,218 crore compared to ₹ 975 crore, while the impairment on financial instruments was ₹ 363 crore against the gain of ₹ 30 crore a year ago. The net worth of the company appreciated to ₹ 12,042 crore from ₹ 9,110 crore in FY25. Similarly, its loan book increased to ₹ 79,941 crore compared to ₹ 63,207 crore a year ago. The company's loan sanctions grew to ₹ 11,740 crore against ₹ 9,136 crore in the corresponding period a year ago, while the loan disbursements rose to ₹ 6,980 crore from ₹ 5,325 crore. "Our expanding loan book and net worth reflect our strategic focus and robust operations. IREDA supports India's renewable energy journey with a growing portfolio and strong performance, committed to a sustainable future through innovation and responsible finance," Pradip Kumar Das, Chairman and Managing Director of IREDA, said.
Mint
3 days ago
- Business
- Mint
IREDA net profit falls 36 pc to ₹247 cr in June quarter
New Delhi, Jul 10 (PTI) State-owned Indian Renewable Energy Development Agency on Thursday reported a 36 per cent decline in its net profit to ₹ 247 crore in the June quarter compared to a year ago, mainly due to higher expenses. The company had posted a net profit of ₹ 384 crore in the quarter ended on June 30, 2024, a BSE filing showed. However, the revenue from operations improved to ₹ 1,947 crore during the quarter against ₹ 1,510 crore in the year-ago period. The total expense rose to ₹ 1,655 crore in the quarter from ₹ 1,034.96 crore in the same period a year ago. The financing cost climbed to ₹ 1,218 crore compared to ₹ 975 crore, while the impairment on financial instruments was ₹ 363 crore against the gain of ₹ 30 crore a year ago. The net worth of the company appreciated to ₹ 12,042 crore from ₹ 9,110 crore in FY25. Similarly, its loan book increased to ₹ 79,941 crore compared to ₹ 63,207 crore a year ago. The company's loan sanctions grew to ₹ 11,740 crore against ₹ 9,136 crore in the corresponding period a year ago, while the loan disbursements rose to ₹ 6,980 crore from ₹ 5,325 crore. "Our expanding loan book and net worth reflect our strategic focus and robust operations. IREDA supports India's renewable energy journey with a growing portfolio and strong performance, committed to a sustainable future through innovation and responsible finance," Pradip Kumar Das, Chairman and Managing Director of IREDA, said. The company's primary business is to provide finance for Renewable Energy & Energy Efficiency projects and related activities carried out in India.
Mint
3 days ago
- Business
- Mint
Centre grants tax benefits to Ireda bonds
New Delhi: The finance ministry has notified bonds issued by Indian Renewable Energy Development Agency Ltd (Ireda) as 'long-term specified asset' under section 54EC of the Income-tax Act, 1961. The notification came into effect from 9 July, the ministry of new and renewable energy said on Thursday. Bonds redeemable after five years and issued by Ireda after the notification will qualify for tax exemption under section 54EC of the Income Tax Act, 1961, which allows capital gains tax exemption on investments in specified bonds. "Eligible investors can save tax on Long Term Capital Gain (LTCG) up to ₹ 50 lakh by investing in these Bonds in a Financial Year. Ireda will get benefit in terms of lower cost of funds, which is a significant development for the renewable energy sector, in turn to support the expeditious development of RE sector," the MNRE statement said. It added that the proceeds from these bonds will be utilized exclusively for renewable energy projects capable of servicing debt through their project revenues, without dependence on state governments for debt servicing. Pradip Kumar Das, chairman and managing director, Ireda, said: 'This recognition by the government reinforces Ireda's pivotal role in accelerating renewable energy financing in the country. The tax-exempt status for our bonds will offer an attractive investment avenue while ensuring increased capital availability for green energy projects, contributing to India's 500 GW non-fossil fuel capacity target by 2030.' The ministry, in its statement said that the move is expected to attract wider participation from investors seeking tax-saving instruments and strengthen the renewable energy financing ecosystem in the country. The bonds of state-run Power Finance Corporation (PFC) and REC have already been granted the exemption, which is expected to boost investments in the renewable energy space. In April this year, the Central Board of Direct Taxes, under the finance ministry also notified the bonds of Housing and Urban Development Corporation (Hudco) as long-term assets under Section 54EC of the Income Tax Act. This relaxation is expected to boost financing in the green energy space as the government aims to achieve 500 GW of non-fossil installed power generation capacity by 2030. In April Ireda CMD Pradip Kumar Das had said at an event that India would require investments of about ₹ 30-32 trillion for energy transition by 2030. For the fourth quarter of FY25, the state-run company recorded a 49% rise in standalone net profit to ₹ 502 crore as against ₹ 337 crore in the same period last year. On Thursday, the company announced in Q1FY26 results. Its net profit for the April-June quarter declined 35.1% to ₹ 246.68 crore in the compared to ₹ 383.7 crore in the same quarter of the previous year. Its shares on the BSE closed at ₹ 169.65, higher by 2.26% from its previous close.
New Indian Express
4 days ago
- Business
- New Indian Express
CBDT notifies IREDA bonds as tax-saving investment to boost green energy financing
NEW DELHI: In a bid to support renewable energy financing in India, the Central Board of Direct Taxes (CBDT), under the Ministry of Finance, has notified bonds issued by the Indian Renewable Energy Development Agency Ltd. (IREDA) will be treated as 'long-term specified assets' under Section 54EC of the Income-tax Act, 1961. The notification came into effect from July 9, 2025. This means that investors can now save tax on long-term capital gains by investing in IREDA bonds. Under Section 54EC, individuals can invest up to Rs 50 lakh in such bonds within six months of earning long-term capital gains and claim a full tax exemption on those gains. IREDA bonds will have a lock-in period of five years and will be redeemable afterward. The funds raised will be used only for renewable energy projects that can generate enough revenue on their own, without needing financial help from state governments. 'This recognition by the Government reinforces IREDA's pivotal role in accelerating renewable energy financing in the country. The tax-exempt status for our bonds will offer an attractive investment avenue while ensuring increased capital availability for green energy projects, contributing to India's 500 GW non-fossil fuel capacity target by 2030,' said Pradip Kumar Das, Chairman & Managing Director, IREDA. IREDA, a government-owned financial institution under the Ministry of New and Renewable Energy, plays a key role in funding clean energy projects across the country. The tax-free status of its bonds is expected to attract more investors, reduce borrowing costs, and boost renewable energy development. This move also supports India's target of achieving 500 GW of non-fossil fuel capacity by 2030 and reinforces the country's global climate commitments.
