News ArticleREC Limited Reports 6% Loan Book Growth and INR7,541 Crores Net Profit in H1 FY 27 with Strong Asset Quality
Capital adequacy ratio at 24.04%, disbursements up 67% in Q2 FY 27 with diversified funding across power and infrastructure sectors
REC Limited announced a 6% growth in its loan book to INR6.17 lakh crores and a net profit of INR7,541 crores for the half year ended September 30, 2026. The company maintained a capital adequacy ratio of 24.04% and improved its net credit-impaired assets to 0.11%. Disbursements grew 67% over Q1 FY 27, with strong contributions from renewable energy, conventional generation, and distribution sectors. REC sustained stable net interest margin of 3.22% and return on equity of 16.89%.
REC Limited
Earnings Call Transcript
REC Limited posted a 6% year-on-year increase in its loan book reaching INR6.17 lakh crores and earned a net profit of INR7,541 crores for the half year ended September 30, 2026, maintaining strong asset quality and capital adequacy.
The company’s net worth grew by 14% to INR94,325 crores, while net credit-impaired assets decreased to 0.11% from 0.24% a year ago, reflecting robust asset quality.
For the half year, total income stood at INR29,068 crores with net interest income around INR10,116 crores. The capital adequacy ratio was healthy at 24.04%, well above the RBI requirement of 15%.
REC’s interest income was INR28,398 crores against finance cost of INR18,282 crores, resulting in a profit before tax of INR9,483 crores. Key financial ratios included a stable yield on loan assets of 9.57%, cost of funds at 7.19%, net interest margin of 3.22%, and return on equity of 16.89%.
Operationally, the company disbursed INR56,457 crores in H1 FY 27, marking 67% growth over Q1. Disbursements were diversified across sectors: 11% in conventional generation, 17% in renewable energy, and 22% in distribution during Q2.
Loan assets grew across segments with renewable energy increasing by 15% and infrastructure and logistics rising by 6% from March 31, 2026. Borrowings increased by 4% to INR5.27 lakh crores as of September 30, 2026.
Highlights
- Loan book reached all-time high of INR6.17 lakh crores, up 6% Y-o-Y
- Net profit for H1 FY 27: INR7,541 crores
- Capital adequacy ratio of 24.04%, exceeding regulatory requirement
- Net credit-impaired assets reduced by 50% to 0.11%
- Disbursements of INR56,457 crores in H1 FY 27, a 67% increase over Q1
- Strong diversification across power, renewable, distribution, infrastructure, and logistics sectors
Key Data Snapshot
Financial performance
- Loan book grew 6% year-on-year to INR6.17 lakh crores by September 30, 2026.
- Net profit for the half year was INR7,541 crores with total income of INR29,068 crores.
- Net interest income was INR10,116 crores for H1 FY 27, supporting profitability.
- Profit before tax reached INR9,483 crores during the period.
- Key ratios included 9.57% yield on loan assets and 7.19% cost of funds, maintaining healthy spreads.
- Capital adequacy ratio stood at 24.04%, well above the regulatory minimum of 15%.
Operational performance
- Disbursements in H1 FY 27 increased 67% over Q1 FY 27 to INR56,457 crores.
- Disbursements during Q2 FY 27 were allocated 11% to conventional generation, 17% to renewable energy, and 22% to distribution.
- Loan assets grew by 6% overall since March 31, 2026, with renewables expanding 15% and infrastructure/logistics 6%.
- Borrowings rose 4% to INR5.27 lakh crores as at September 30, 2026.
- REC continues to finance across the full power sector value chain and infrastructure segments including emerging technologies.
Financial performance
- Net credit-impaired assets reduced to 0.11% from 0.24% a year ago, with gross credit-impaired assets at 0.22%.
- Provision coverage ratio maintained at approximately 51% on NPA assets.
- Stage 1 assets constitute 99.26% of the loan portfolio with provisions at 0.85%.
- No new NPAs have been raised from private sector loans over the last 19 quarters.
Highlights
- Loan book reached all-time high of INR6.17 lakh crores, up 6% Y-o-Y
- Net profit for H1 FY 27: INR7,541 crores
- Capital adequacy ratio of 24.04%, exceeding regulatory requirement
- Net credit-impaired assets reduced by 50% to 0.11%
- Disbursements of INR56,457 crores in H1 FY 27, a 67% increase over Q1
- Strong diversification across power, renewable, distribution, infrastructure, and logistics sectors
Disclosures
- SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015
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