REC Limited, formerly known as Rural Electrification Corporation Limited, is a Central Public Sector Undertaking under the Ministry of Power, Government of India. Established in 1969, REC is a leading financial institution involved in financing projects across the complete power sector value chain, from generation and transmission to distribution. With its extensive portfolio, REC plays a pivotal role in supporting the development of India’s power infrastructure.
In this article, we’ll discuss everything about REC Limited, including its history, operations, financial performance, key projects, and its significant contribution to the power sector.
Comprehensive Financial Solutions by REC Limited: Empowering India’s Power Sector and Infrastructure Development
REC Limited offers a wide range of financial services tailored to the power sector. The company provides loans for setting up new power generation projects using both conventional and renewable energy sources. Additionally, REC finances transmission projects to evacuate power from new stations and enhance existing transmission systems, as well as distribution projects aimed at improving power sub-transmission and distribution networks. To meet short- and medium-term financial needs, REC offers loans for purposes such as fuel purchases, power procurement, and system maintenance.
Recently, REC has expanded into lending for infrastructure and logistics sectors, including metro, road and highways, port waterways, and steel infrastructure development. Supported by the Indian government, REC acts as a nodal agency for implementing schemes like the Deendayal Upadhyaya Gram Jyoti Yojana (DDUGJY) and SAUBHAGYA, enabling it to raise funds competitively. In FY23, REC sanctioned loans totaling ₹2,68,460 crores and aims to sanction ₹4,00,000 crores and disburse ₹1,50,000 crores in FY24.
REC Limited Quarterly Financial Highlights – Q4 2024
- Sales: Recorded significant growth, reaching ₹12,052 crores.
- Operating Profit: Strengthened to ₹13,102 crores, supported by an impressive operating profit margin (OPM) of 103%.
- Other Income: Increased to ₹29 crores, contributing positively to overall profitability.
- Interest Expenses: Managed effectively at ₹7,896 crores, reflecting prudent financial management.
- Profit Before Tax: Marked a substantial increase to ₹5,229 crores, indicating robust operational performance.
- Net Profit: Reached ₹4,079 crores, demonstrating sustained profitability and growth.
- Earnings Per Share (EPS): Rose to ₹15.49, showcasing improved earnings per share.
- Tax Efficiency: Maintained at 22%, optimizing tax liabilities effectively.
Below are the trading platforms that you can use to purchase REC shares:
➤ Zerodha
➤ Upstox
➤ Groww
➤ AngelOne
➤ ICICIDirect
| When | Maximum Price | Minimum Price |
| June 2024 | 550.80 | 478.96 |
| July 2024 | 545.29 | 474.17 |
| August 2024 | 567.10 | 493.13 |
| September 2024 | 589.79 | 512.86 |
| October 2024 | 578.22 | 502.80 |
| November 2024 | 595.57 | 517.89 |
| December 2024 | 610.46 | 530.83 |
In 2024, REC Limited’s share price showed a promising upward trend, with projections indicating robust potential for investors. Starting from a current price of ₹510 as of June 21st, 2024, the stock is expected to range between ₹478.96 and ₹610.46 by the end of December 2024. This forecast suggests a positive trajectory, with peaks in September and December potentially reaching highs of ₹589.79 and ₹610.46, respectively.
REC Limited, with a market capitalization of ₹1,34,426 crore, maintains a healthy stock P/E ratio of 9.50, a book value of ₹263, and a dividend yield of 3.13%. Its strong ROCE of 10.0% and ROE of 22.2% underscore its solid financial performance and investor appeal in the market.
| When | Maximum Price | Minimum Price |
| January 2025 | 622.67 | 478.98 |
| February 2025 | 638.63 | 491.26 |
| March 2025 | 663.54 | 510.42 |
| April 2025 | 650.53 | 500.41 |
| May 2025 | 631.58 | 485.83 |
| June 2025 | 660.00 | 507.70 |
| July 2025 | 647.06 | 497.74 |
| August 2025 | 667.08 | 513.13 |
| September 2025 | 690.42 | 531.09 |
| October 2025 | 708.37 | 544.90 |
| November 2025 | 726.08 | 558.53 |
| December 2025 | 744.24 | 572.49 |
In 2025, REC Limited’s share price is poised for strong growth, with projected highs ranging from ₹622.67 to ₹744.24 by December. Starting from an estimated minimum of ₹478.98 in January, the stock is expected to gradually increase throughout the year, reflecting positive investor sentiment and market outlook. REC Limited maintains a robust asset quality, reporting gross NPAs of 3.42% and net NPAs of 1.01% in FY23, actively managing stressed assets through a dedicated team.
The company’s outstanding loan composition as of H1FY24 shows a predominant reliance on private sector borrowers, comprising 90% of its loan portfolio, with the remaining 10% attributed to public sector borrowers. These factors, alongside its strong financial metrics and strategic initiatives, position REC Limited favorably for continued growth and stability in the coming year.
| When | Maximum Price | Minimum Price |
| January 2026 | 766.56 | 589.66 |
| February 2026 | 786.22 | 604.78 |
| March 2026 | 816.88 | 628.37 |
| April 2026 | 800.86 | 616.05 |
| May 2026 | 777.54 | 598.11 |
| June 2026 | 812.53 | 625.02 |
| July 2026 | 796.59 | 612.76 |
| August 2026 | 821.23 | 631.72 |
| September 2026 | 849.97 | 653.83 |
| October 2026 | 872.07 | 670.83 |
| November 2026 | 893.88 | 687.60 |
| December 2026 | 916.22 | 704.79 |
In 2026, REC Limited’s share price is anticipated to see significant growth, with projected highs ranging from ₹766.56 to ₹916.22 by December. Beginning the year with a minimum estimated at ₹589.66 in January, the stock is expected to steadily increase month-over-month, reflecting strong investor confidence and favorable market conditions. REC Limited’s loan portfolio composition as of H1FY24 indicates a diverse allocation, with distribution projects comprising the largest share at 44%, followed by power generation at 29%, transmission at 10%, renewables at 6%, and infra & logistics at 10%.
The company’s loan book is supported by major borrowers including Tamil Nadu Generation and Distribution (9.5%), Maharashtra State Electricity Distribution (4.5%), Uttar Pradesh Power Corporation (4%), and Kaleshwaram Irrigation Project Corporation (3.8%), highlighting its strategic lending practices and sectoral diversification.
| When | Maximum Price | Minimum Price |
| January 2027 | 934.55 | 718.88 |
| February 2027 | 958.51 | 737.31 |
| March 2027 | 995.89 | 766.07 |
| April 2027 | 976.36 | 751.05 |
| May 2027 | 947.93 | 729.17 |
| June 2027 | 990.58 | 761.99 |
| July 2027 | 971.16 | 747.05 |
| August 2027 | 1,001.20 | 770.15 |
| September 2027 | 1,036.24 | 797.11 |
| October 2027 | 1,063.18 | 817.83 |
| November 2027 | 1,089.76 | 838.28 |
| December 2027 | 1,117.00 | 859.23 |
In 2027, REC Limited’s share price is projected to experience substantial growth, with anticipated highs ranging from ₹934.55 to ₹1,117.00 by December. Starting the year with a minimum estimate of ₹718.88 in January, the stock is expected to show consistent upward momentum throughout the year, driven by strong market performance and investor optimism.
REC Limited remains a pioneer in sustainable finance, having issued Green Bonds in 2017, marking its status as the first Indian PSU to raise funds internationally through the London Stock Exchange’s International Securities Market. These 10-year Green Bonds are dedicated to financing or refinancing eligible green projects aligned with the Climate Bond Standards, reinforcing REC’s commitment to environmentally responsible investment practices alongside its robust financial growth trajectory.
| When | Maximum Price | Minimum Price |
| January 2028 | 1,139.34 | 876.42 |
| February 2028 | 1,168.56 | 898.89 |
| March 2028 | 1,214.13 | 933.95 |
| April 2028 | 1,190.32 | 915.63 |
| May 2028 | 1,155.65 | 888.97 |
| June 2028 | 1,207.66 | 928.97 |
| July 2028 | 1,183.98 | 910.75 |
| August 2028 | 1,220.60 | 938.92 |
| September 2028 | 1,263.32 | 971.78 |
| October 2028 | 1,296.16 | 997.05 |
| November 2028 | 1,328.57 | 1,021.98 |
| December 2028 | 1,361.78 | 1,047.53 |
- January 2028: ₹876.42 (Minimum)
- December 2028: ₹1,361.78 (Maximum)
| When | Maximum Price | Minimum Price |
| January 2029 | 1,389.02 | 1,068.48 |
| February 2029 | 1,424.63 | 1,095.87 |
| March 2029 | 1,480.20 | 1,138.61 |
| April 2029 | 1,451.17 | 1,116.29 |
| May 2029 | 1,408.90 | 1,083.77 |
| June 2029 | 1,472.31 | 1,132.54 |
| July 2029 | 1,443.44 | 1,110.34 |
| August 2029 | 1,488.08 | 1,144.68 |
| September 2029 | 1,540.16 | 1,184.74 |
| October 2029 | 1,580.21 | 1,215.54 |
| November 2029 | 1,619.71 | 1,245.93 |
| December 2029 | 1,660.20 | 1,277.08 |
- January 2029: ₹1,068.48(Minimum)
- December 2029: ₹1,660.20 (Maximum)
| When | Maximum Price | Minimum Price |
| January 2030 | 1,693.41 | 1,302.62 |
| February 2030 | 1,736.83 | 1,336.02 |
| March 2030 | 1,804.57 | 1,388.13 |
| April 2030 | 1,769.18 | 1,360.91 |
| May 2030 | 1,717.65 | 1,321.27 |
| June 2030 | 1,794.95 | 1,380.73 |
| July 2030 | 1,759.75 | 1,353.65 |
| August 2030 | 1,814.18 | 1,395.52 |
| September 2030 | 1,877.67 | 1,444.36 |
| October 2030 | 1,926.49 | 1,481.92 |
| November 2030 | 1,974.65 | 1,518.96 |
| December 2030 | 2,024.02 | 1,556.94 |
- January 2030: ₹1,302.62 (Minimum)
- December 2030: ₹2,024.02 (Maximum)
Financial Condition of REC Ltd: Last 5 Years
| Financial Metrics | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 |
|---|---|---|---|---|---|---|
| Sales (₹ Crores) | 25,408 | 29,942 | 35,557 | 39,276 | 39,486 | 47,505 |
| Expenses (₹ Crores) | 1,702 | 3,981 | 3,292 | 4,838 | 1,858 | -360 |
| Operating Profit (₹ Crores) | 23,705 | 25,961 | 32,265 | 34,438 | 37,628 | 47,865 |
| OPM (%) | 93% | 87% | 91% | 88% | 95% | 101% |
| Other Income (₹ Crores) | 33 | 72 | 15 | 62 | 28 | 66 |
| Interest (₹ Crores) | 15,639 | 18,991 | 21,489 | 22,051 | 23,733 | 29,948 |
| Depreciation (₹ Crores) | 8 | 12 | 11 | 18 | 24 | 24 |
| Profit Before Tax (₹ Crores) | 8,090 | 7,030 | 10,780 | 12,431 | 13,898 | 17,960 |
| Tax % | 29% | 29% | 22% | 19% | 20% | 21% |
| Net Profit (₹ Crores) | 5,741 | 4,972 | 8,378 | 10,036 | 11,167 | 14,145 |
| EPS (₹) | 21.80 | 18.88 | 31.82 | 38.11 | 42.41 | 53.72 |
| Dividend Payout (%) | 38% | 44% | 30% | 30% | 30% | 30% |
REC Ltd has demonstrated robust financial performance over the last five years, reflecting steady growth across key metrics. From 2019 to 2024, the company’s sales increased from ₹25,408 crores to ₹47,505 crores, with a compounded annual growth rate (CAGR) of 13% over this period. Operating profit similarly rose from ₹23,705 crores to ₹47,865 crores, underpinned by efficient cost management and improved operational efficiency, resulting in an average OPM of 93% to 101%. Net profit grew consistently from ₹5,741 crores to ₹14,145 crores, translating to an impressive EPS escalation from ₹21.80 to ₹53.72.
REC Ltd’s financial health is further underscored by its strong compounded profit growth rates: 20% over five years and 27% in the trailing twelve months (TTM). The stock has shown remarkable price appreciation with a CAGR of 34% over the last five years, reflecting investor confidence in its performance. Return on Equity (ROE) remained robust at around 20% over the past five years, increasing marginally to 22% in the latest fiscal year, indicating effective utilization of shareholders’ funds. These metrics collectively highlight REC Ltd’s resilience and strategic growth trajectory in the power financing sector.
FAQs
What is REC Limited’s current market capitalization?
REC Limited’s current market capitalization stands impressively at ₹1,34,426 crore, reflecting its substantial presence in the power financing sector.
As of June 21st, 2024, REC Limited’s share price is quoted at ₹510, showcasing stability and investor confidence in its performance.
REC Limited’s share price target for December 2024 ranges from ₹478.96 to ₹610.46, indicating potential for growth amidst positive market sentiments.
REC Limited’s share price target for December 2025 is projected between ₹622.67 and ₹744.24, highlighting robust growth prospects driven by strategic initiatives and strong financial performance.
REC Limited targets its share price to grow significantly, ranging from ₹1,302.62 to ₹2,024.02 by December 2030, reflecting long-term confidence and market leadership.
What is REC Limited’s current Price-to-Earnings (P/E) ratio, and what does it signify?
REC Limited currently maintains a P/E ratio of 9.50, showcasing a balance between stock valuation and earnings potential, making it an attractive investment choice.
REC Limited consistently maintains a dividend payout ratio of 30%, demonstrating its commitment to providing attractive returns to shareholders.
How has REC Limited achieved impressive sales growth over the past 5 years?
REC Limited achieved a commendable sales CAGR of 13% from 2019 to 2024, driven by its pivotal role in financing critical power infrastructure projects across India.
REC Limited’s EPS has grown significantly from ₹21.80 in 2019 to ₹53.72 in 2024, reflecting robust profitability and shareholder value creation.
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Conclusion: Is it advisable to invest in REC in 2024?
Investing in REC Limited in 2024 appears promising, considering its robust financial performance and strategic initiatives in the power and infrastructure sectors. REC has demonstrated strong sales growth with a CAGR of 13% over the past five years, supported by an impressive operating profit margin and substantial profit and EPS growth. The company’s market capitalization of ₹1,34,426 crore reflects its significant role in power financing, enhancing investor confidence.
However, potential investors should note the company’s lower interest coverage ratio and the possibility of capitalizing interest costs, indicating a need for cautious monitoring of financial health metrics. Despite this, REC Limited maintains a healthy dividend payout ratio of 30%, providing attractive returns to shareholders. Given its expansion into infrastructure lending and strategic government support through initiatives like DDUGJY and SAUBHAGYA, REC is well-positioned for future growth.
Overall, while considering the sector’s potential and REC’s strong market presence, investing in REC Limited could be advisable for those seeking exposure to India’s power sector and infrastructure development, provided they monitor financial metrics closely.
What did we learn?
- 1 Comprehensive Financial Solutions by REC Limited: Empowering India’s Power Sector and Infrastructure Development
- 2 REC Limited Quarterly Financial Highlights – Q4 2024
- 3 How to Purchase REC Shares in India?
- 4 REC Share Price Prediction: 2024 – 2030
- 5 Financial Condition of REC Ltd: Last 5 Years
- 6 FAQs
- 6.1 What is REC Limited’s current market capitalization?
- 6.2 What is REC Limited’s current share price?
- 6.3 What can investors expect from REC Limited’s share price target for 2024?
- 6.4 How promising is REC Limited’s share price target for 2025?
- 6.5 What ambitious targets does REC Limited aim for its share price in 2030?
- 6.6 What is REC Limited’s current Price-to-Earnings (P/E) ratio, and what does it signify?
- 6.7 How does REC Limited reward its shareholders through dividends?
- 6.8 How has REC Limited achieved impressive sales growth over the past 5 years?
- 6.9 How has REC Limited enhanced its earnings per share (EPS) over recent years?
- 7 Conclusion: Is it advisable to invest in REC in 2024?
