Indian Bureaucracy, October 26, 2024, Delhi | In a Board meeting held today in Mumbai, REC Ltd. announced its unaudited financial results for Q2 and the half-year ending September 30, 2024. The Board reported the highest-ever half-yearly profit of ₹7,448 crore for this period and approved a second interim dividend of ₹4 per share, amid solid financial performance.
Additionally, REC has appointed Shri Subrata Aich as Chief Risk Officer, effective December 1, 2024, succeeding Smt Malathi Sundararajan. Shri Rajesh Kumar, Executive Director (Finance-Bonds), has been designated as Key Managerial Personnel (KMP) of the company.
For Q2 FY25, REC experienced year-over-year growth, with revenue from operations rising 17% to ₹13,571 crore from ₹11,576 crore, while the total income of the company was reported to be ₹13,596 crore as against ₹11,590 crore in Q2 FY24 (standalone), up 17% and the net interest income increasing 22% to ₹5,012 crore from ₹4,091 crore. Disbursements grew 14% to ₹47,303 crore, with funding for renewable energy catagory up by 38% from ₹5,946 crore from ₹4,309 crore in Q2 FY24.
The Board also announced its financial results for the half-year ending September 30, 2024. Revenue from operations increased by 18% to ₹26,594 crore, while total income rose 18% to ₹26,633 crore as compared to ₹22,552 crore and ₹22,571 crore same time FY24. Net interest income grew by 25% to ₹9,723 crore. The company sanctioned ₹60,391 crore to the renewable sector, reflecting a 21% increase, with total disbursements at ₹90,955 crore, up 20%. Disbursements for renewables nearly doubled to ₹11,297 crore, a 93% year-over-year increase.
Highest ever half yearly Net profit was reported at ₹7,448 crore, an 11% rise compared to the previous year. Yield improved by 18 bps to 10.08%, and the average cost of funds decreased to 7.12%. The spread increased to 2.96%, and net interest margin rose to 3.64%. Market capitalization reached ₹1,46,011 crore, a 93% increase from the previous year. The Return on net worth stood at 21.03%
Owing to growth in all the verticals, resetting of interest rates on loan assets, and effective management of finance costs, REC is able to maintain its spreads and NIMs, resulting in a robust half-year profit after tax of ₹7,448 crore. Consequently, Earnings Per Share (EPS) increased to ₹28.28 for the period ending September 30, 2024, compared to ₹25.57 the previous year.
REC’s Asset Under Management (AUM) rose by 15.2% to ₹5.46 lakh crore as of September 30, 2024. The company reduced its net credit-impaired assets to 0.88% from 0.96%, maintaining a Provision Coverage Ratio of 65.12% on NPA assets. Market capitalization increased 93% year-over-year to ₹1,46,011 crore.
The Capital Adequacy Ratio (CRAR) stood at 25.31%, while Net Worth grew by 15% to ₹72,893 crore. The Earnings Per Share (EPS) for the period ending September 30, 2024, rose to ₹28.28 from ₹25.57 a year earlier.
With REC’s continued focus on supporting India’s power sector, with a particular focus on renewable energy initiatives, the Board of Directors also announced formation of two special purpose vehicles (SPVs) under REC Power Development and Consultancy Limited (RECPDCL) to enhance key transmission projects in India. The first project aims to integrate renewable energy zones with a capacity of 4.5 GW in the Inter-State Transmission System for Kumool-IV REZ – Phase-I. The second project will transmit 1,230 MW of power in Madhya Pradesh from the proposed Mahan Energen Ltd. thermal power project.
