dynamic levels research report on rec ltd · finance and promote rural electrification projects all...

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Report By: Vikash Kandoi – [email protected]

mailto:[email protected]

Source: Company, www.dynamiclevels.com

Providing Financial assistance to Power Companies

Company Overview and Stock price ……………………………………….……3

Product Overview……………………………………………………………….….…..4

Industry Outlook………………………………………………………………………..6

Company Financial….……..……….…………….……………………….….…..….8

Balance Sheet…………………………………………..………….………….….…….9

Cash Flow……………..………………………………..…………….………….……..10

Key Financial Ratios………………………………………………………………….10

Peer Comparison…………….…………………………………………….……..…..11

Shareholding Pattern…………………………………………..……………....……13

Investment Rationale………………………………………...………….......…....14

Disclaimer……………………………………………………………………………..…15

Surbhi Lohia – [email protected]

mailto:[email protected]


Company’s Overview and Stock Price

Rural Electrification Corporation Limited (REC), a NAVRATNA Central

Public Sector Enterprise under Ministry of Power, was incorporated on

July 25, 1969 under the Companies Act 1956. Its main objective is to

finance and promote rural electrification projects all over the country. It

provides financial assistance to State Electricity Boards, State

Government Departments and Rural Electric Cooperatives for rural

electrification projects as are sponsored by them.

REC provides loan assistance to SEBs/State Power Utilities for

investments in rural electrification schemes through its Corporate Office

located at New Delhi and 20 field units, which are located in most of the

States.

The Project Offices in the States coordinate the programmes of REC’s

financing with the concerned SEBs/State Power Utilities and facilitate in

formulation of schemes, loan sanction and disbursement and

implementation of schemes by the concerned SEBs/State Power

Utilities.

EXCHANGE SYMBOL FUTURE REC

Current Price * (Rs.) 212.05

Face Value (Rs.) 10

52 Week High (Rs.) 297.55 (05-Oct-15)

52 Week Low (Rs.) 152.25 (17-Feb-16)

Life Time high (Rs.) 413.80 (12-Oct-10)

Life Time low (Rs.) 53.00 (28-Nov-08)

Average Daily Movement

7.13

Average Volume [20 days]

16311450

1 Month Return (%) 18.41

P/E Ratio (x) 3.74

Book Value 253.91

Market Cap 21013.13 (Cr)

% of Promoter pledged 0

This is a 1 year weekly chart of REC LTD a continuous buying from 150 levels


Product overview

Generation - Conventional Financing of Generation Projects by REC

Upto May 2002, REC used to finance only Mini/Micro Generation

Projects upto 25MW capacity. In June 2002, the mandate of REC

was expanded to include financing of all generation projects

without limit on size or location.

REC finances all type of Power Generation Projects like Thermal,

Hydel, Renewable Energy, R&M of existing projects etc.

The borrowers of REC include State Sector Power Utilities/SEBs,

Central Sector, Joint Sector and Private Sector Power Utilities.

REC sanctions loan as a sole lender or co-lender or in

consortium with or without the status of lead financer.

As per the present policy, loans for public sector generation

projects are sanctioned upto a maximum of 80% of project cost

i.e. in a Debt Equity Ratio of 80:20 but upto the exposure limit

fixed for the Power Utility. For Private Sector Projects, the

financing by REC is limited upto 50% of the project cost or 25%

of the net worth of REC, whichever is less.

The tenure of loans for generation projects varies between 10 to

15 years with a suitable moratorium period depending upon a

case-to-case basis.

REC has formed a separate division for DDG projects

which looks after the sanction of loan for small hydro, biomass,

wind energy, solar and co-generation power projects.

Major Projects sanctioned so far by REC in state sector include

1. Santaldih TPP in West Bengal

2. Lehra Mohabbat TPP in Punjab

3. Korba(East) and Korba(West)TPPs in Chhattisgarh

4. Vijaywada and Kakatiya TPP in Andhra Pradesh

5. Bhusawal and Chandrapur TPP in

Maharashtra

6. Tehri HEP in Uttaranchal

7. Utran TPP in Gujarat

8. Durgapur Steel TPP of DVC

9. Baglihar HEP in J&K

10. Anpara-D TPP in Uttar Pradesh

11. Vallur and North Chennai TPP in

Tamilnadu

12. Chhabra TPP in Rajasthan

13. Nabinagar Thermal Power Project

in Bihar etc.

Major promoters in private sector have

also approached REC for finance. In

private sector, REC has sanctioned loan

for

1. Karcham Wangtoo HEP in

Himachal Pradesh

2. Sasan Ultra Mega Power Project

3. Mahan Superthermal Power

Project and Maheshwar HEP in

M.P

4. Pathadi TPP in Chhattisgarh,

Wardha TPP in Maharashtra

5. Adani thermal Power Project in

Gujarat

6. Teesta Stage-III and VI HEP in

Sikkim etc


REC is acting as lead financier in

1. 100 MW Malana-II Hydro Electric Project in H.P

2. The 1200 MW Teesta Phase-III Hydro Electric Project in

Sikkim

3. The 270 MW phase-I and 270 MW Phase-II coal based

thermal power project of Wardha Power Company Pvt.

Ltd. in Maharashtra

4. The 1200 MW Anpara-C Thermal Power Project in Uttar

Pradesh

5. The 1320 MW coal based thermal power project of

Thermal PowerTech Corporation (India) Ltd. in Andhra

Pradesh.


Industry Outlook Introduction

Ujwal DISCOM Assurance Yojana (UDAY) is the financial

turnaround and revival package for electricity distribution

companies of India (DISCOMs) initiated by the Government of

India with the intent to find a permanent solution to the financial

mess that the power distribution is in.

The scheme comprises four initiatives - improving operational

efficiencies of discoms, reduction of cost of power, reduction in

interest cost of discoms and enforcing financial discipline on

discoms through alignment with state finances. It allows state

governments, which own the discoms, to take over 75 percent of

their debt as of September 30, 2015, and pay back lenders by

selling bonds. Discoms are expected to issue bonds for the

remaining 25 percent of their debt.

Features of the scheme

States shall take over 75% of DISCOM debt as on 30 September

2015 over two years - 50% of DISCOM debt shall be taken over

in 2015-16 and 25% in 2016-17.

Government of India will not include the debt taken over by the

States as per the above scheme in the calculation of fiscal deficit

of respective States in the financial years 2015-16 and 2016-17.

States will issue non-SLR including SDL bonds in the market or

directly to the respective banks / Financial Institutions (FIs)

holding the DISCOM debt to the appropriate extent.

DISCOM debt not taken over by the State shall be converted by

the Banks / FIs into loans or bonds with interest rate not more

than the bank’s base rate plus 0.1%. Alternately, this debt may

be fully or partly issued by the DISCOM as State guaranteed

DISCOM bonds at the prevailing market rates which shall be

equal to or less than bank base rate plus 0.1%.

States shall take over the future losses of DISCOMs in a

graded manner.

State DISCOMs will comply with the

Renewable Purchase Obligation

(RPO) outstanding since 1 April

2012, within a period to be decided in

consultation with Ministry of Power.

States accepting UDAY and

performing as per operational

milestones will be given additional /

priority funding through Deendayal

Upadhyaya Gram Jyoti Yojana

(DDUGJY),Integrated Power

Development Scheme (IPDS), Power

Sector Development Fund (PSDF) or

other such schemes of Ministry of

Power and Ministry of New and

Renewable Energy.

Such States shall also be supported

with additional coal at notified prices

and, in case of availability through

higher capacity utilization, low cost

power from NTPC and other Central

Public Sector Undertakings (CPSUs).

States not meeting operational

milestones will be liable to forfeit their

claim on IPDS and DDUGJY grants.

Power is one of the most critical

components of infrastructure crucial for

the economic growth and welfare of

nations. The existence and development

of adequate infrastructure is essential for

sustained growth of the Indian economy.

India’s power sector is one of the most

diversified in the world. Sources of power

generation range from conventional

sources such as coal, lignite, natural gas,

oil, hydro and nuclear power to viable

non-conventional sources such as wind,

solar, and agricultural and domestic

waste. Electricity demand in the country


has increased rapidly and is expected to rise further in the years

to come. In order to meet the increasing demand for electricity in

the country, massive addition to the installed generating capacity

is required.

India ranks third, just behind US and China, among 40 countries#

with renewable energy focus, on back of strong focus by the

government on promoting renewable energy and implementation

of projects in a time bound manner.

Market Size

Indian power sector is undergoing a significant change that has

redefined the industry outlook. Sustained economic growth

continues to drive electricity demand in India. The Government of

India’s focus on attaining ‘Power for all’ has accelerated capacity

addition in the country. At the same time, the competitive

intensity is increasing at both the market and supply sides (fuel,

logistics, finances, and manpower).

Total capacity of renewable energy plants in India stood at

42,850 megawatts as on April 30, 2016, thereby surpassing the

42,783 megawatts capacity of large hydroelectricity projects in

the country.$ Cumulative solar installations in India crossed the

7.5 gigawatt (GW) mark in May 2016, about 2.2 GW more than

all of the solar installations in 2015.%

The Planning Commission’s 12th Five-Year Plan estimates total

domestic energy production to reach 669.6 Million Tonnes of Oil

Equivalent (MTOE) by 2016–17 and 844 MTOE by 2021–22. As

of January 2016, total thermal installed capacity stood at 200.74

Gigawatt (GW), while hydro (renewable) energy installed capacity

totaled 42.66 GW. At 5.78 GW, nuclear energy capacity

remained broadly constant compared with the previous year.

India’s rooftop solar capacity addition grew 66 per cent from last

year to reach 525 Mega Watts (MW), and has the potential to

grow up to 6.5 Giga watts (GW)!. India’s wind power capacity,

installed in FY2016, is estimated to increase 20 per cent over last

year to 2,800 Mega Watt (MW)@, led by favourable policy

support that has encouraged both independent power producers

(IPP) and non-IPPs. India is expected to add nearly 4,000

Megawatts (MW)## of solar power in 2016, nearly twice the

addition of 2,133 MW in 2015.

India’s wind energy market is expected to attract investments

totaling Rs 1,00,000 crore (US$ 14.82 billion) by 2020, and wind

power capacity is estimated to almost double by 2020 from over

23,000 MW in June 2015, with an addition of about 4,000 MW

per annum in the next five years.

Investment Scenario

Around 293 global and domestic

companies have committed to generate

266 GW of solar, wind, mini-hydel and

biomass-based power in India over the

next 5–10 years. The initiative would

entail an investment of about US$ 310–

350 billion.

Between April 2000 and March 2016, the

industry attracted US$ 10.48 billion in

Foreign Direct Investment (FDI).

The Road Ahead

The Indian power sector has an

investment potential of Rs 15 trillion (US$

222.36 billion) in the next 4–5 years,

thereby providing immense opportunities

in power generation, distribution,

transmission, and equipment, according

to Union Minister Mr. Piyush Goyal.

The government’s immediate goal is to

generate two trillion units (kilowatt hours)

of energy by 2019. This means doubling

the current production capacity to provide

24x7 electricity for residential industrial,

commercial and agriculture use.

The Government of India is taking a

number of steps and initiatives like 10-

year tax exemption for solar energy

projects, etc., in order to achieve India's

ambitious renewable energy targets of

adding 175 GW of renewable energy,

including addition of 100 GW of solar

power, by the year 2022. The cumulative

installed capacity of solar power in India

has crossed the 4 Gigawatt mark as of

June 30, 2015. The government has also

sought to restart the stalled hydro power

projects and increase the wind energy

production target to 60 GW by 2022 from

the current 20 GW.


Company Financials

10

In Cr Mar'16 Dec'15 Sep'15 Jan'15 Mar'15 Mar'16

Quarterly Quarterly Quarterly Quarterly Quarterly Annual

Net Sales/Income from operations 6015.38 5987.25 5827.05 5640.98 5293.26 23470.66

Other Operating Income 48.76 30.70 66.32 21.91 40.14 167.69

Total Income From Operations 6064.14 6017.95 5893.37 5662.89 5333.40 23638.35

Employees Cost 35.71 32.71 33.52 35.50 38.33 137.44

Depreciation 1.37 1.34 1.40 1.34 1.47 5.45

Other Expenses 56.78 158.22 53.32 218.07 457.17 195.21

Total Expenditure 93.86 192.27 88.24 254.91 496.97 338.10

Operating Profit 5505.89 5566.62 5754.05 5383.84 4714.66 22210.40

Provisions And Contingencies 464.39 259.06 51.08 24.14 121.77 1089.85

Other Income 20.33 19.50 31.36 46.74 37.36 117.93

P/L Before Int., Excpt. Items & Tax 5526.22 5586.12 5785.41 5430.58 4752.02 22328.33

Interest 3753.53 3706.61 3516.62 3306.36 3092.98 14283.12

P/L Before Tax 1772.69 1879.51 2268.79 2124.22 1659.04 8045.21

Tax 609.83 509.65 649.60 645.64 561.83 2420.32

PAT 1160.03 1369.86 1619.19 1478.58 1096.50 5627.66

Prior Year Adjustments -2.83 -- -- -- -0.71 2.77

Equity Share Capital 987.46 987.46 987.46 987.46 987.46 987.46

Reserves 27630.30 23869.57 -- -- -- 27630.30

Equity Dividend Rate (%) -- -- -- -- -- 171.00

EPS (Rs.) [After Extraordinary items] 11.75 13.87 16.40 14.97 11.10 56.99

Net Sales jump by 13.64% YoY basis in same quarter from Rs. 5293.60 crores to Rs. 6015.38 crores

and a marginal rise in QoQ by 0.46%.

Operating Profit jump 16.77% YoY basis in same quarter from Rs. 4714.66 crores to Rs. 5505.89

crores and marginal fall in QoQ by 1.10%.

Company has good net profit margin 19.28% for Mar’16 quarter.

Provisions and Contingencies in the company have gone up heavily 80% from Rs. 259.06 Crore to

Rs. 464.39 crores.


Balance sheet

In Cr Mar'15 Mar'14 Mar'13 Mar'12

Annual Annual Annual Annual

EQUITIES AND LIABILITIES

SHAREHOLDERS FUNDS

Equity Share Capital 987.46 987.46 987.46 987.46

Total Share Capital 987.46 987.46 987.46 987.46

Reserves and Surplus 24085.12 19815.59 16542.38 13818.42

Total Reserves and Surplus 24085.12 19815.59 16542.38 13818.42

Total Share holder’s Funds 25072.58 20803.05 17529.84 14805.88

NON-CURRENT LIABILITIES

Long Term Borrowings 131123.26 110095.30 90925.38 76553.68

Deferred Tax Liabilities [Net] 105.80 172.92 0.00 0.00

Other Long Term Liabilities 36.18 23.54 80.57 26.50

Long Term Provisions 1007.39 442.32 188.47 61.78

Total Non-Current Liabilities 132272.63 110734.08 91194.42 76641.96

CURRENT LIABILITIES

Short Term Borrowings 734.00 2540.00 2485.55 2501.71

Trade Payables 28.81 6.07 3.97 4.23

Other Current Liabilities 24889.21 18601.87 19125.84 14517.14

Short Term Provisions 458.71 259.25 227.48 339.68

Total Current Liabilities 26110.73 21407.19 21842.84 17362.76

Total Capital And Liabilities 183455.93 152944.33 130567.10 108810.60

ASSETS

NON-CURRENT ASSETS

Tangible Assets 108.50 70.65 68.09 68.60

Intangible Assets 1.47 2.45 3.78 2.24

Capital Work-In-Progress 9.81 10.37 8.75 7.92

Intangible Assets Under Development 0.00 0.00 0.00 0.10

Fixed Assets 119.78 83.47 80.62 78.86

Non-Current Investments 1157.21 1643.03 590.85 685.32

Deferred Tax Assets [Net] 0.00 0.00 9.65 10.02

Long Term Loans And Advances 164215.05 135899.77 114574.68 89985.40

Other Non-Current Assets 85.29 33.71 130.91 247.92

Total Non-Current Assets 165577.33 137659.99 115386.71 91007.52

Foreign Currency Monetary Item Translation Difference A/C 0.00 0.00 0.00 181.88

CURRENT ASSETS

Current Investments 438.81 47.41 47.41 47.26

Trade Receivables 120.29 60.54 28.53 38.01

Cash And Cash Equivalents 645.71 1234.29 1529.54 5375.36

Short Term Loans And Advances 1100.85 382.84 1916.02 2967.50

Other Current Assets 15572.95 13559.25 11658.90 9193.07

Total Current Assets 17878.61 15284.33 15180.40 17621.20

Total Assets 183455.93 152944.33 130567.10 108810.60


Cash Flow

Particulars Mar'15 Mar'14 Mar'13 Mar'12


Net Profit/Loss Before Extraordinary Items And Tax 7427.04 6531.12 5163.95 3792.86

Net Cash Flow From Operating Activities -23991.77 -17282.79 -20084.2 -15762.5

Net Cash Used In Investing Activities 244.94 138.86 166.03 77.48

Net Cash Used From Financing Activities 23076.43 16852.61 16090.98 18164.6

Net Inc/Dec In Cash And Cash Equivalents -670.4 -291.32 -3827.22 2479.59

Cash And Cash Equivalents Begin of Year 1192.94 1484.26 5311.48 2831.89

Cash And Cash Equivalents End Of Year 522.54 1192.94 1484.26 5311.48

Company has not made any huge investment during March 2015.

Particulars 15-Mar 14-Mar 13-Mar 12-Mar


Per Share Ratios

Basic EPS (Rs.) 53.27 47.43 38.66 28.53

Diluted EPS (Rs.) 53.27 47.43 38.66 28.53

Cash EPS (Rs.) 53.34 47.47 38.7 28.56

Dividend / Share(Rs.) 10.70 9.5 8.25 7.5

Revenue from Operations/Share (Rs.) 204.86 172.34 136.91 104.69

Net Profit/Share (Rs.) 53.27 47.43 38.66 28.53

Profitability Ratios

PBT Margin (%) 36.71 38.37 38.19 36.68

Net Profit Margin (%) 26.00 27.52 28.23 27.25

Return on Capital Employed (%) 3.34 3.56 3.51 3.08

Return on Assets (%) 2.87 3.06 2.92 2.59

Total Debt/Equity (X) 5.31 5.45 5.35 5.36

Liquidity Ratios

Current Ratio (X) 0.68 0.71 0.69 1.01

Quick Ratio (X) 0.68 0.71 0.69 1.01

Dividend Payout Ratio (NP) (%) 20.08 20.02 21.33 26.28

Earnings Retention Ratio (%) 79.92 79.98 78.67 73.72

Valuation Ratios

EV/Net Operating Revenue (X) 8.12 7.88 8.32 9.1

EV/EBITDA (X) 8.52 8.09 8.54 9.24

Market Cap/Net Operating Revenue (X) 1.62 1.33 1.52 1.96

Price/BV (X) 1.32 1.09 1.18 1.38

Price/Net Operating Revenue 1.62 1.33 1.52 1.96


Peer Comparison

Peer Comparison on Market Liquidity and Volume

SL INSTRUMENT Price Avg. Volume Market Cap (Rs. in Cr)

1 IDFC 56.75 7568812 9248

2 LIC HOUSING 501.30 2849339 25912

3 LT FINANCE 87.45 6189369 15498

4 MAHINDRA FINANCE 323.85 2746145 19204

5 PFC 216.10 3075426 28955

6 PFS 39.10 1561666 2220

7 REC 213.25 5136176 21255

Rec Ltd has good average volume and market capitalization this give liquidity to the share price of

stock.

Peer Comparison on Investment and Valuations

SL INSTRUMENT Price % FII Holding P/E Ratio

1 IDFC 56.75 46.09 0.00

2 LIC HOUSING 501.30 0.00 15.33

3 LT FINANCE 87.45 8.80 17.75

4 MAHINDRA FINANCE 323.85 33.66 24.86

5 PFC 216.10 13.17 4.73

6 PFS 39.10 10.01 5.68

7 REC 213.25 18.25 3.78

REC is trading at lowest PE among its peer companies and having good FII

holdings of 18.25%.

Peer Comparison on leverage Position

SL INSTRUMENT Price P/E Ratio (X)

Debt Equity Ratio (X)

Int. Coverage Ratio (X)

1 IDFC 56.75 0.00 5.01 1.30

2 LIC HOUSING 501.30 15.33 10.56 1.26

3 LT FINANCE 87.45 17.75 7.46 1.32

4 MAHINDRA FINANCE 323.85 24.86 3.95 1.44

5 PFC 216.10 4.73 5.22 1.55

6 PFS 39.10 5.68 3.43 1.60

7 REC 213.25 3.78 5.26 1.64


Peer Comparison as per Quarterly Profitability

SL INSTRUMENT Price PAT JUN' 16

PAT MAR' 16

PAT DEC' 15

PAT JUN' 15

1 IDFC 56.75 331.08 270.61 309.05 273.59

2 LIC HOUSING 501.30 407.84 448.02 418.9 382.13

3 LT FINANCE 87.45 204.76 235.98 211.24 192.11

4 MAHINDRA FINANCE 323.85 110.14 417.45 100.55 109.71

5 PFC 216.10 0.00 1259.65 1582.32 1576.21

6 PFS 39.10 0.00 49.03 69.45 61.37

7 REC 213.25 0.00 1160.03 1369.86 1478.58

Peer Comparison on Performance

SL INSTRUMENT 1M 3M 6M 1Y % chg Post Budget

1 PFC 23.68 24.99 32.7 -10.91 40.97

2 IDFC 20.23 33.07 43.44 -22.86 54.95

3 REC 19.78 24.31 20.32 -20.85 37.58

4 LT FINANCE 10.16 20.45 57.21 24.88 74.26

5 LIC HOUSING 2.95 12.88 15.96 0.36 25.74

6 PFS 1.94 3.13 12.54 -12.03 25.6

7 MAHINDRA FINANCE -4.89 8.97 69.12 31.92 67.99


Shareholding Pattern & Management

Shareholding Pattern Jun-16 Mar-16 Dec-15 Sep-15 Jun-15

Promoter and Promoter Group (%) 60.64 60.64 60.64 60.64 60.64

Indian 60.64 60.64 60.64 60.64 60.64

Foreign NIL NIL NIL NIL NIL

Institutions (%) 30.40 32.76 33.40 33.61 33.21

FII 18.25 21.37 21.55 21.42 21.65

DII 12.15 11.39 11.85 12.19 11.56

Non Institutions (%) 8.96 6.60 5.96 5.75 6.16

Bodies Corporate NIL NIL NIL 2.21 2.83

Others 8.96 6.60 5.96 3.54 3.32

Custodians NIL NIL NIL NIL NIL

Total no. of shares (cr.) 98.75 98.75 98.75 98.75 98.75

Company has good FII and DII holdings

Persons holding securities more than 1% of total number of shares under category Public Shareholding

Investors Jun-16 Mar-16 Dec-15 Sep-15 Jun-15

PRESIDENT OF INDIA 60.64 60.64 60.64 60.64 60.64

LIC OF INDIA 7.94 7.94 7.94 7.46 6.10

Bodies Corporate 2.24 1.75 2.10 NIL NIL

DB INTERNATIONAL (ASIA) LTD 1.56 1.70 NIL 2.25 2.09

COMPANY PROFILE OF REC, NSE, INDIA

Date of Incorporation 25-Jul-1969

Date of Listing 12-Mar-2008

Management

Name Designation

Rajeev Sharma Chairman & Managing Director

Ajeet Kumar Agarwal Director - Finance

S K Gupta Director - Technical

Arun Kumar Verma Nominee Director

Aravamudan Krishana Kumar Non Official PartTime Director

Arun Singh Non Official PartTime Director

T T Ram Mohan Non Official PartTime Director

Registered Office Address

Core-4,SCOPE Complex, 7, Lodhi Road,110003,New Delhi,Delhi,India

Website

http://www.recindia.gov.in


Investment Rationale

REC ltd is a Navaratna Central Public Sector Enterprise under Ministry of Power.

Company has a net worth of Rs. 24857.03 crore as on 31st march 2015

REC Operates through a network of 13 project offices and 5 Zonal Offices

The company is currently among the top 500 Global Financial Services brands by UK-based

plc Brand Finance (Brand Finance @ Global Banking 500 for 2010)

The company is among the Forbes Global 2000 companies for 2010

REC finances all types of Power Generation projects including Thermal, Hydel, Renewable Energy,

etc. Without limit on size or location.

The company aims to increase presence in emerging areas like de-centralised distributed

generation (DDG) projects, and new and renewable energy sources to reach remote and difficult

terrains not connected by power grid network.

Domestic debt instruments of REC are assigned the highest rating "AAA" by reputed credit rating

agencies CRISIL, Fitch and ICRA. Moody’s and Fitch have rated its international credit rating at par

with India’s sovereign rating.

Net Sales jump by 13.64% YoY basis in same quarter from Rs. 5293.60 crores to Rs. 6015.38 crores

and a marginal rise in QoQ by 0.46%.

Operating Profit jump 16.77% YoY basis in same quarter from Rs. 4714.66 crores to Rs. 5505.89

crores and marginal fall in QoQ by 1.10%.

Company has good net profit margin 19.28% for Mar’16 quarter.

We recommend BUY in REC Ltd @ 210 with a target of Rs. 240, a NAVRATNA

Central Public Sector Enterprise under Ministry of Power. Company has a net

worth of Rs. 24857.03 crore as on 31st March 2015

https://www.dynamiclevels.com/en/rec-share-price-forecast


Disclaimer: Research Disclaimer and Disclosure inter-alia as required under Securities and Exchange Board of India (Research Analysts) Regulations, 2014. Dynamic Equities Pvt. Ltd. is a member of National Stock Exchange of India Ltd. (NSEIL), Bombay Stock Exchange Ltd (BSE), Multi Stock Exchange of India Ltd (MCX-SX) and also a depository participant with National Securities Depository Ltd (NSDL) and Central Depository Services Ltd.(CDSL). Dynamic is engaged in the business of Stock Broking, Depository Services, Investment Advisory Services and Portfolio Management Services. Dynamic Equities Pvt. Ltd. is holding company of Dynamic Commodities Pvt. Ltd. , a member of Multi Commodities Exchange (MCX) & National Commodity & Derivatives Exchange Ltd.(NCDEX). We hereby declare that our activities were neither suspended nor we have defaulted with any stock exchange authority with whom we are registered. SEBI, Exchanges and Depositories have conducted the routine inspection and based on their observations have issued advise letters or levied minor penalty on for certain operational deviations. Answers to the Best of the knowledge and belief of Dynamic/ its Associates/ Research Analyst who prepared this report

DYANMIC/its Associates/ Research Analyst/ his Relative have any financial interest in the subject company? No

DYANMIC/its Associates/ Research Analyst/ his Relative have actual/beneficial ownership of one per cent or more securities of the subject company? No

DYANMIC/its Associates/ Research Analyst/ his Relative have any other material conflict of interest at the time of publication of the research report or at the time of public appearance? No

DYANMIC/its Associates/ Research Analyst/ his Relative have received any compensation from the subject company in the past twelve months? No

DYANMIC/its Associates/ Research Analyst/ his Relative have managed or co-managed public offering of securities for the subject company in the past twelve months? No

DYANMIC/its Associates/ Research Analyst/ his Relative have received any compensation for investment banking or merchant banking or brokerage services from the subject company in the past twelve months? No

DYANMIC/its Associates/ Research Analyst/ his Relative have received any compensation for products or services other than investment banking or merchant banking or brokerage services from the subject company in the past twelve months? No

DYANMIC/its Associates/ Research Analyst/ his Relative have received any compensation or other benefits from the Subject Company or third party in connection with the research report? No

DYANMIC/its Associates/ Research Analyst/ his Relative have served as an officer, director or employee of the subject company? No

DYANMIC/its Associates/ Research Analyst/ his Relative have been engaged in market making activity for the subject company? No

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