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I read SHA1 is still a secured hashing function with no collision found as of now. However, it's just a matter of time for someone to come up with such a collision or attack. Therefore, in new projects, it is recommended to use SHA256. SHA512 is even better.

In Java, we still use SHA1PRNG algorithm in SecureRandom class for the purpose of generating IV (let's say for CBC).

Is it enough secured as a PRNG generating unpredictable IV for CBC? Or even for a PRNG, SHA256 is recommended?

I read SHA1 is still a secured hashing function with no collision found as of now.

You read an old text, this is not the case anymore since SHA-1 was SHAttered.

In Java, we still use SHA1PRNG algorithm in SecureRandom class for the purpose of generating IV (let's say for CBC).

Is it enough secured as a PRNG generating unpredictable IV for CBC? Or even for a PRNG, SHA256 is recommended?

SHA-1 is still fine for key derivation, HMAC, MGF1 based padding and indeed random generation and many other use cases that do not suffer from collision attacks.

That said, attacks can only get better, never worse, so using a more modern hash is always recommended. When it comes to random number generation the seeding is much more likely to be problematic though, and you should definitely make sure that your systems RNG is running correctly.

And, when it comes to Java's SecureRandom, you may want to consider my answer on StackOverflow and not use (or at least indicate) "SHA1PRNG" at all.