REC Q2 net profit rises 39% to ₹3,789.9 cr

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₹3,789.90 crore. “Owing to the improving asset quality, increase in lending rates and effective management of Finance Cost, REC is able to record its highest ever quarterly profit," the company said in a statement. During the same period last fiscal, the company had registered a net profit of ₹2,732.12 crore.

The government-run non-banking financial company’s (NBFC) total revenue from operations rose 17.39% during the quarter to ₹11,688.24 crore from ₹9,955.99 crore a year ago, according to the company’s filing with the stock exchanges. During the period under review, loans worth ₹1.04 trillion were sanctioned, up from ₹84,889 crore sanctioned a year ago. Loans for renewable energy projects accounted for 24% of the total sanctions.

Annualized earnings per share for the quarter ended 30 September improved to ₹51.14 apiece, up from ₹39.32 per share a year ago. Loan book increased 20% to ₹4.74 trillion by the end of the fiscal second quarter from ₹3.94 trillion in the year-ago period. “Signifying improving asset quality, the net cedit-impaired assets have reduced to 0.96% with provision coverage ratio of 69.37% on NPA assets, as at 30 September 2023," as per the statement.

Capital adequacy ratio (CRAR) of the NBFC, which largely lends to the power sector, stood at a comfortable 28.53% at the end of September. The company has diversified into infrastructure and logistics sector in a major way, ever since it became a Maharatna company in September 2022. Recently, the company signed a memorandum of understand (MoU) with Punjab National Bank to jointly explore the possibility of funding the power, and infrastructure & logistics sector projects under the consortium arrangement.