PAT – rS. 1,764 CRORE, EPS – rS. 8.93 FOR Q2 FY19
New Delhi, 5th December 2018: The Board of Directors of REC Limited (Formerly Rural Electrification Corporation Ltd.) approved the unaudited standalone financial results for Q2 and H1 FY19 today.
Highlights – Q2 FY19 vs Q2 FY18
- Sanctions – Rs. 49,003 crore vs. Rs. 22,300 crore, up 120%
- Disbursements – Rs. 24,226 crore vs. Rs. 13,751 crore, up 76%
- Total Income – Rs. 7,299 crore vs. Rs. 5,604 crore, up 30%
- Profit before Tax – Rs. 2,525 crore vs Rs. 1,994 crore, up 27%
- Net Profit – Rs. 1,764 crore vs Rs. 1,408 crore, up 25%
Highlights – H1 FY19 vs H1 FY18
- Sanctions – Rs. 67,770 crore vs. Rs. 56,168 crore, up 21%
- Disbursements – Rs. 32,542 crore vs. Rs. 26,535 crore, up 23%
- Total Income – Rs. 13,618 crore vs. Rs. 11,226 crore, up 21%
- Profit before Tax – Rs. 4,636 crore vs Rs. 3,395 crore, up 37%
- Net Profit – Rs. 3,233 crore vs Rs. 2,484 crore, up 30%
The Loan Book of the Company has seen a healthy growth of 19%, as it grew from Rs. 2.16 lakh crore as at 30th Sept. 2017 to Rs. 2.57 lakh crore as at 30th Sept. 2018. On the back of the increased loan book, the Total Income of the Company during the current quarter has been Rs. 7,299 crore, as against Rs. 5,604 crore in Q2 FY18. Consequently, the Net Profit for the Company has increased by 25% from Rs. 1,408 crore in Q2 FY18 to Rs. 1,764 crore in Q2 FY19. This has been the highest ever quarterly profit declared by the Company. The Earnings per Share (EPS) during Q2 FY19 has also increased to Rs. 8.93, in comparison to EPS of Rs. 7.13 during Q2 FY18.
The Net Worth of the Company stands at Rs. 32,755 crores as at 30th Sept. 2018 and the capital adequacy is also placed at comfortable levels of 16.14% to support the future growth of the Company.
As the company stays focused on maintaining the asset quality, the Gross NPA% has improved sequentially from 8.12% as at 30th June 2018 to 7.92% as at 30th Sept. 2018. The Provision Coverage Ratio against the credit-impaired assets under the Expected Credit Loss (ECL) framework stands at 45.92% as at 30th Sept. 2018. Further, there are no indications of credit impairment in the loans to the Govt. sector, forming 87% of the loan book.
The domestic debt instruments of REC continue to enjoy “AAA” rating – the highest rating assigned by CRISIL, CARE, India Ratings & Research & ICRA-Credit Rating Agencies. The Company also enjoys international credit rating of “Baa3” and “BBB-” from International Credit Rating Agencies Moody’s and FITCH respectively. With the credit ratings reflecting a strong credit profile, the Company enjoys a diversified borrowing profile and has also been frequently tapping foreign markets to raise funds. The Company had recently converted its USD$ 3 Billion Medium Term Note (MTN) programme into a USD$ 5 Billion Global MTN (GMTN) Programme and has raised US$ 700 million 5-year US Dollars denominated bonds in Nov. 2018 from its inaugural foray into the 144A market under the GMTN programme.
The diversified borrowing profile from the domestic as well as the international markets allows the company to maintain its finance costs at competitive levels and during the quarter, the Company has in fact been able to reduce the cost of funds by 29 bps from 7.57% in Q2 FY18 to 7.28% in Q2 FY19.
Talking about the results, Dr. P.V. Ramesh, Chairman and Managing Director, said, “The Company has registered a strong operational performance during the current period and has seen a robust growth in the sanctions, disbursements and key financial parameters. While the financial sector is passing through challenging times, the Company has been growing steadily but prudently too. As we have stepped into our 50th year, the company remains geared towards harnessing the opportunities across the power sector value chain and creating value for all the stakeholders. We have been witnessing steady progress in the resolution of stressed assets and continue to remain optimistic in this respect going forward as well.”
About the Company:
REC Limited (formerly Rural Electrification Corporation Limited) is a Navratna NBFC and Infrastructure Finance Company (IFC) focusing on Power Sector Financing and Development across India. It provides financial assistance to state electricity boards, state governments, central/state power utilities, independent power producers, rural electric cooperatives and private sector utilities. Its business activities involve financing projects in the complete power sector value chain; different type of projects includes Generation, Transmission, Distribution Projects and Renewable Energy projects.