The gross non-performing assets (NPA) in the March quarter declined to 2.71 per cent, compared to 2.78 per cent in the preceding December quarter.
The NPA came in at 0.86 per cent, compared to 0.82 per cent in the previous quarter.
The net-interest margin (NIM) in the quarter-under-review was 3.60 per cent, compared to 3.29 per cent in the year-ago period.
In the past one month, REC gave 12.45 per cent returns, against 1.24 per cent and 1.13 per cent returns by Nifty 50 and Sensex respectively.
The PSU provides loans to central/state sector power utilities in the country, state electricity boards, rural electric cooperatives, NGOs and private power developers.
REC Share Price Today: Shares of public-sector undertaking (PSU) REC Ltd, formerly Rural Electrification Corporation, gained 10 per cent during intra-day and became a BSE top gainer Tuesday, April 30. REC has given multibagger returns to investors over the last one-to-three year time periods.
The surge in shares came as the power projects financer announced its January-March quarter results for fiscal 2023-24 (Q4FY24) reporting a jump of 34 per cent in net profit at ₹4,016.3 crore, compared to ₹3,00.9 crore in the corresponding period last year. The rise in net profit was aided by the credit impairment amount of ₹712 crore in the quarter-under-review.
Also Read: Multibagger defence PSU hits upper circuit as Defence Ministry issues tender worth ₹65,000 crore for fighter jets
REC Q4 Results -Key Metrics
The net interest income (NII)--the difference between interest earned and paid--rose 25 per cent to ₹4,273 crore, compared to ₹3,407 crore in the year-ago period. The gross non-performing assets (NPA) in the March quarter declined to 2.71 per cent, compared to 2.78 per cent in the preceding December quarter.
The NPA came in at 0.86 per cent, compared to 0.82 per cent in the previous quarter. The net-interest margin (NIM) in the quarter-under-review was 3.60 per cent, compared to 3.29 per cent in the year-ago period. The operating profit rose 27.05 per cent year-on-year (YoY) to ₹4,435.9 crore in the said quarter.
REC chairman and managing director V K Dewangan said that the company is confident of maintaining the NIM at over 3.55 per cent for FY25. According to a senior official, there will be a minor uptick in the disbursements in the new fiscal year at ₹40,000 crore compared to ₹39,374 crore achieved in FY24.
Also Read: 200% return in 1 year: Multibagger smallcap hits 20% upper circuit on ₹233-crore govt order; do you own?
REC will be very choosy on accepting the proposals from outside of the power sector, the chairman said, adding that it will go for such proposals only if they are good projects. Dewangan said the company is also aiming to increase the fund allocation to the private sector to 30 per cent from 10 per cent at present and added increased play in the renewable space, where a bulk of the borrowing requirements come from the private sector, will help achieve the aim by the end of FY30.
Renewable energy accounts for only 10 per cent of the overall ₹5.09 lakh crore of assets under management at present, and the same will touch 30 per cent by the end of FY30, he said. On the asset quality front, Dewangan said the company is aiming to be 'NPA (non-performing assets) free' by the end of FY25, once bad assets of over ₹13,800 crore are resolved.
He said there have not been any fresh slippages for the last eight consecutive quarters, and added that its focus is on ensuring the quality of the book remains strong. For the quarter under review, it had a provision write-back of ₹713 crore, which helped the bottom line. This was due to higher sums of money set aside for stressed loans in the past and the resolutions yielding more money.
Dewangan said that the write-back is primarily driven by a resolution of an asset in the bankruptcy proceedings, and added that there will be more such provision write-backs in FY25. REC has a debt-raising plan of ₹1.60 lakh crore for the new fiscal, and a bulk 40 per cent of it will be raised through issuing bonds domestically, another 10 per cent through tax saving bonds, over a third through external commercial borrowings while the balance will come through term loans from banks.
REC expects the cost of borrowing to fall in the second half of the fiscal by over 0.50 per cent courtesy of rate cuts from the Reserve Bank of India (RBI), and affirmed to pass on the benefits to end borrowers. The company's board today approved a dividend of ₹5 per equity share for FY24, in addition to the interim dividend of ₹11 which was already paid during the reporting fiscal year.
Also Read: Q4 results today: Indian Oil, REC, Adani Energy and Havells among 56 companies to report Q4 earnings on April 30
REC Share Price Today
Shares of REC opened at ₹464.50 and were locked at 10 per cent upper circuit to hit an intra day high of ₹511.65 before settling 9.51 per cent higher at ₹507.25 apiece on the BSE. REC emerged as the top gainer on BSE earlier today.
REC has neared its 52-week high mark of ₹524 today. According to Trendlyne data, REC has given better returns compared to Nifty 50 and Sensex in the last one year. In the past one month, REC gave 12.45 per cent returns, against 1.24 per cent and 1.13 per cent returns by Nifty 50 and Sensex respectively.
In the last one year, REC has given a massive 283.77 per cent returns to investors as against 25.13 per cent and 21.88 per cent returns by Nifty 50 and Sensex respectively. Power Finance Corporation Limited (PFC) is a holding company in REC and is under the ownership of the Ministry of Power.
REC finances and promotes power projects across the country. The PSU provides loans to central/state sector power utilities in the country, state electricity boards, rural electric cooperatives, NGOs and private power developers.
REC More Information
Milestone Alert! Livemint tops charts as the fastest growing news website in the world 🌏 Click here to know more.
Unlock a world of Benefits! From insightful newsletters to real-time stock tracking, breaking news and a personalized newsfeed – it's all here, just a click away! Login Now!
