REC reports highest-ever quarterly net profit of Rs 3,773 crore

Declares 2nd interim dividend of Rs 3.5 per share for FY24

geetanjali

Geetanjali Minhas | November 1, 2023 | Mumbai


#REC   #business   #public sector  


State-run REC Limited, a Maharatna  company, on Wednesday declared its second interim dividend of Rs 3.5 per share for FY2024. Earlier, in August, the company’s board had approved its first interim dividend of Rs 3 per share for the current FY and also announced a bonus issue of 1:3 (1 bonus share for every 3 shares held).

The annualised earning per share for quarter ended 30th September 2023 accelerated to Rs 51.14 per share against Rs 39.32 per share as at September 2022.

The record date for the second interim dividend has been fixed as November 13, 2023 and the dividend will be paid to shareholders on or before November 30.

REC, operating under the administrative control of the Ministry of Power, and registered with RBI as Non-Banking Finance Company (NBFC), Public Financial Institution (PFI) and Infrastructure Financing Company (IFC) has announced a growth of 38% net profit amounting to Rs 3773Cr for Q2FY24. The company has reported an increase of 119% total comprehensive income of Rs 4188 Cr as against Rs 1915 Cr in Q2FY23.

Announcing key highlights to the press, CMD Vivek Kumar Dewangan said in the Q2 of FY 24 Sanctions grew by 23% to Rs 1,04,366 crore  from Rs 84,889 crore in Q2FY23 out of which Renewable sector constitutes for 24%.

Disbursements also grew by 133% and increased to Rs 41,598 crore from Rs 17,827 crore in previous year. Interest Income on Loan Assets went up by 18%  to Rs 11,213 crore (up from Rs 9,534 crore), Net Profit increased by 38% to Rs  3,773 crore (up from Rs 2,728 crore) and Total Comprehensive Income surged up 119% to Rs  4,188 crore from Rs 1,915 crore in previous year.

Further, for H1FY24 (first half of fiscal year) the company said Sanctions surged by 35%  to Rs 1,95,163 crore vs. Rs 1,44,784 crore in H1FY23 out of which  Renewable sector constitute for 26%. Disbursements increased by 150%  to Rs 75,731 crore vs. Rs 30,269 crore, Interest Income on Loan Assets went up 15% to Rs 21,678 crore vs. Rs 18,796 crore , Net Profit went up by 30% to Rs  6,734 crore vs. Rs  5,176 crore  and Total Comprehensive Income went up 99% to Rs 7,331 crore vs. Rs  3,690 crore as  against previous year.   

Owing to improving asset quality, increase in lending rates and effective management of Finance Cost, REC has recorded its highest ever quarterly profit of Rs 3,773 crore. As a result, the annualised Earnings Per Share for the quarter ended 30th September 2023 accelerated to Rs 51.14 per share as against Rs 39.32 per share as at 30th September 2022.

As on 30th September, 2023,  REC’s Net Worth has grown to Rs 63,117 , a YOY increase of 18%. The loan book has maintained its growth trajectory and has increased by 20% to Rs  4.74 lakh crore as against Rs  3.94 lakh crore as at 30th September 2022. Signifying improving asset quality, the Net Credit-impaired assets have reduced to 0.96% with Provision Coverage Ratio of 69.37% on NPA assets, as at 30th September 2023, the company said.

Indicating  ample opportunity to support future growth REC said its Capital Adequacy Ratio (CRAR)  stands at a comfortable 28.53% as on 30th September 2023.

Since September 2022, after becoming  a Maharatna company, REC Limited has diversified into infrastructure and Logistics sector. It has signed MOU’s with Punjab National Bank for Rs 55,000 crore and  Bank of India for Rs 30,000 crore. It has also signed MOU with SJVN for Rs 50,000 Cr for setting up power generation projects based on conventional and renewable sources of energy.

Recently on the sidelines of the G20 Summit, REC signed MOUs with RE Developers amounting to a total of around Rs 2.86 lakh crore.

Also present at the press  briefing were Director (Projects) Vijay Kumar Singh, Director (Finance) Ajoy Choudhary, Executive Director (Finance) Sanjay Kumar, Executive Director & Company Secretary, JS Amitabh and Executive Director TSC Bosh.

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