Slide 1: Management Presentation: Performance Highlights Q4 and 12M FY18
Rural Electrification Corporation Limited A Navratna PSU Management Presentation Performance Highlights Q4 and 12M FY 18 THE FUNDING PARTNER FOR POWER SECTOR
Slide 2: Table of Contents
Table of Contents India - Power Sector – Empowering India REC Overview Operational Performance Asset Quality Borrowing Profile Financial Highlights Disclaimer : • This presentation is for information purposes only and is not to be construed as an offer or invitation or recommendation to buy or sell
Slide 3: India Power Sector: Empowering India
India Power Sector Empowering India 3
Slide 4: Generation
Generating Stations 900 Installed Capacity 344 GW Generation Generation Units 2200 PLF 65% Peak Demand 164 GW 4
Slide 5: Transmission
Transmission 7000 Substations Lines 3,90,970 CKM Transmission LINES 100 nos -765KV Transformation Capacity >1300 nos –400KV 8,04,458 MVA LINES 26 ISTS >3200 nos– 220KV Transmission 10 nos – HVDC Licensees Bipole BtB 5
Slide 6: Annual Per Capita Consumption of Electricity (kwh)
Annual Per Capita Consumption of Electricity (kwh) 1200 1122 * 1075 * 1010 1000 957 914 884 819 800 779 Per capita Consumption 717 734 672 World - 2,674 631 Brazil - 2,516 600 South Africa - 3,904 China - 4,475 400 Japan - 7,371 Russia - 7,481 200 Singapore - 8,160 USA - 12,071 0 2005- 2006- 2007- 2
Slide 7: Estimated Demand by 2021-22 (MW)
Estimated MW Already 234,169 achieved Demand by 250,000 70% 2021-22 (MW) 200,000 164,066 150,000 100,000 50,000 0 As at 31.03.18 Target 2021-22 Source : CEA 7
Slide 8: Generation Capacity by 2026-27 (GW)
GW Generation 700 619 Capacity by 600 479 2026-27 (GW) 500 400 344 275 264 300 243 223 175 200 69 100 45 51 63 17 7 10 0 Thermal Nuclear Hydro RES Total As at 31.03.18 2021-22 2026-27 Source : CEA, NEP 8
Slide 9: Fund Requirement (Generation) by 2026-27
Rs. Crores 933,839 956,214 1000000 Fund Requirement 900000 (Generation) by 800000 2026-27 700000 600000 542,954 (Rs. Crores) 495,082 500000 400000 291,589 300000 246,127 200000 79,706 98,902 89,837 45,855 100000 0 Thermal Nuclear Hydro RES Total 2019 - 2022 2023 - 2027 Estimated fund requirement for
Slide 10: Transmission Line Capacity by 2021-22 (CKM)
CKM Transmission Line 500,000 Capacity 470,515 Already achieved by 2021-22 (CKM) 450,000 83% 390,970 400,000 350,000 300,000 250,000 As at 31.03.18 Target FY 21-22 Source : CEA 10
Slide 11: Transformation Capacity by 2021-22 (MVA)
Transformation MVA 979,637 1,000,000 Already achieved Capacity 950,000 900,000 82% by 2021-22 (MVA) 850,000 804,458 800,000 750,000 700,000 650,000 600,000 550,000 500,000 As at 31.03.18 Target FY 21-22 Estimated fund requirement for Transmission capacity addition including Transformation – INR 2,60
Slide 12: Renewable Energy in India
Renewable Energy in India Sources Potential (%) Potential (GW) Installed Installed Target Expected 2027 Particulars Capacity Capacity Wind Power (Onshore) 11% 103 2022 (NEP) 30.09.2017 31.03.2018 Solar 83% 749 Small Hydro 2% 20 Solar >1 MW 14,772 21,651 100,000 57% 1,50,000 55% Biomass /Bagasse 3% 2
Slide 13: Distribution Modernization by 2019
Present By March 2019 AT & C Loss Below 15% Distribution 19.87% * Modernization by 2019 Gap ACS -ARR Zero Rs.0.23/U* 24X7 Power Supply Power for All Does not include data of Sikkim, Arunachal Pradesh, Mizoram, Daman and Diu, Dadra 19.9 Hrs and Nagar Haveli, Nagaland, Andaman and Nicobar Islands, Lak
Slide 14: SAUBHAGYA
SAUBHAGYA Universal access to Quality Power for All Overview of Saubhagya With effect from 11th October 2017, the Govt. of India launched Rs. 16,350 crores household electrification scheme named Pradhan Mantri Sahaj Bijli Har Ghar Yojana (translated as the Prime Minister’s Programme to provide easy
Slide 15: REC Overview
REC Overview 15
Slide 16: Key Strengths
Unique and close relationship with all Occupies Strategic major players – Public Position in the Growth & Private - in Indian and development of the Power sector Power Sector across India Experienced Management Nodal Agency for Team With providing 24x7 Sector quality power to Expertise all 600,000 K
Slide 17: Major Milestones in Long & Successful journey of more than 48 years
- Nov’ 2017 : “Bharat 22” ETF, GOI holding reduced to 58.32% - Sept’ 2017 : Appointed as the nodal agency for “Saubhagya” Scheme Major Milestones in Long - Jan-March 2017 : CPSE ETF Further Fund Offer (FFO); GoI holding reduced 2017 to 58.86%. & Successful journey of 2015 more than 48 years 2015 : G
Slide 18: Board of Directors
Board of Directors Experienced Team with sector experience Was Principal Finance Secretary / Additional Chief Secretary and Development Commissioner to Government of Andhra Pradesh for five years. Dr. P.V. Ramesh, IAS Substantial expertise & experience in development assistance management (Governmen
Slide 19: Board of Directors
Board of Directors Experienced Team with sector experience Mr. Sanjeev Kumar Gupta Extensive experience in Design & Engineering, planning & implementation & induction of new technologies in Director (Technical) power transmission projects. > 34 years experience BE (Electrical) from G.B. Pant Univers
Slide 20: Board of Directors
Board of Directors Experienced Team with sector experience Professor T.T. Ram Mohan Specializes in financial sector. Previously, Divisional Manager with Tata Economic Consultancy Services. Carried Independent Director out policy studies for Govt and international agencies and consulting assignments
Slide 21: Board of Directors
Board of Directors Experienced Team with sector experience Ms. Asha Swarup Independent Director Has served as Secretary Ministry of I&B, Special Secy./ Addl. Secy. & Financial Adviser in the Ministries of Commerce and Textiles. Chief Secretary, Principal Secy. in Departments of Finance, Health, Powe
Slide 22: Shareholding Pattern
Shareholding Pattern As at 31.03.2018 As at 31.12.2017 GoI , GoI , 58.32 58.32 FPI, 23.56 FPI, 23.18 Others, Others, 0.87 1.34 Insurance Insurance Corporates, Cos., 3.38 Corporates Cos., 3.4 2.01 , 1.62 Individual/ Individual MFs, 5.15 HUF, 6.71 MFs, 4.79 / HUF, 7.35 FPIs have remain invested in REC
Slide 23: Shareholding Pattern
Shareholding Pattern Top 10 Share holders as at March 31, 2018 Shareholding Rank Particulars Category (%) 1 President of India 58.32 POI 2 Life Insurance Corporation of India 2.30 INS 3 The Prudential Assurance Company Limited 1.96 FPI 4 HDFC Trustee Company Limited - HDFC Prudence Fund 1.05 MUT Eas
Slide 24: Operational Performance
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Slide 25: Sanctions - Composition
Sanctions - Composition Sector-wise breakup of Sanctions in 12M FY18 27% Project Loans Generation 12MFY18 49% vs Renewable 12MFY17 7% STL 6% T&D 38% 12M Q4 Discipline-wise FY15 % FY16 % FY17 % FY 18 % FY 17 % FY 18 % Generation 23,778 39 27,828 43 28,209 34 53,224 49 5,517 20 3,840 30 Renewable Ener
Slide 26: Disbursements – Composition
Disbursements – Composition Sector-wise breakup of Disbursements in 12M FY18 3% Project Loans STL Generation 11% 12MFY18 29% vs Renewable 12MFY17 9% Distribution Transmission 40% 11% 12M Q4 Discipline-wise FY 15 % FY 16 % FY 17 % FY18 % FY17 % FY18 % Generation 13,828 32 12,820 27 21,697 37 18,086 2
Slide 27: Outstanding Loans – Composition
Outstanding Loans – Composition State STL Generatio 78% 2% n Customer-wise 45% Category-wise breakup breakup of of Loans as at Renewabl Loans as at e Energy 31.03.2018 Joint 31.03.2018 1% 8% Transmis Distributi Private sion on 14% 19% 33% 12M Discipline-wise FY 15 FY 16 FY 17 FY18 Amt % Amt % Amt %
Slide 28: Outstanding Loans - Asset Diversification
J&K Haryana 312 6,028 Figures in Rs. Crores Himachal 683 Assam 286 Punjab Uttarakhand Arunachal 7,892 2,301 Outstanding Loans - UP 23,967 Sikkim 5,158 19 Asset Diversification Rajasthan 24,409 Bihar 12,139 PAN India Presence with loan concentration across Nagaland 28 states and 1 Union Territory 99
Slide 29: Outstanding Loans – Loan Concentration
Outstanding Loans –Loan Concentration Major Borrowers (as on March 31, 2018) Amount % of Total Loan S.No. Top Ten Borrowers Outstanding Assets (Rs Cr.) Maharashtra State Electricity Distribution Company 1 13,197 5.51% Limited 2 Maharashtra State Power Generation Company Limited 12,748 5.32% 3 Rajast
Slide 30: Asset Quality
Asset Quality 30
Slide 31: Asset Quality – NPA position
Asset Quality – NPA position 8% 7.15% 4.01% 6% 5.68% 3.61% 4% 9,591 8,632 2.41% 2.11% 3.14% 2% 1.60% 1.60% 0.74% 2.07% 0.54% 1,335 970 4,243 3,230 4,873 3,234 7,537 4,980 0% 2015 2016 2017 12M FY18 Gross NPA as per RBI circ dt 12-Feb Net NPA as per RBI circ dt 12-Feb Gross NPA without RBI cir dt 12-
Slide 32: Borrowing Profile
amg at a REC Enos ony hfe poses, Borrowing Profile y ‘THERMAL POWER PLANT. ‘SOLAR POWER PLANT Ma: was ae lsh L ‘SMART HOUSES: GRID MANAGEMENT COMMERCIAL BUILDINGS YS ‘SMART TRANSPORT WIND POWER PLANT HYDROELECTRIC POWER PLANT
Slide 33: Outstanding Borrowings
Outstanding Borrowings Rs. Crores 12M Particulars FY 15 FY 16 FY 17 FY 18 Institutional, Subordinate 97,068 109,678 113,449 128,871 & Zero Coupon Bonds Foreign Currency Borrowings 24,028 21,924 21,081 25,996 FCNR (B) Loans - - - 3,811 Capital Gain Bonds 15,591 17,164 19,477 23,705 Tax Free Bonds 11,
Slide 34: Outstanding Borrowings
Outstanding Borrowings Total Borrowings (Rs. Cr.) 1,51,024 1,69,106 1,67,517 1,98,791 % age 100% 8.0 7.6 7.6 6.4 1.6 90% 3.3 1.9 15.9 12.6 13.0 13.1 80% 0.4 1.5 1.1 0.2 70% 11.6 10.3 10.1 11.9 60% 50% 40% 64.3 64.9 67.8 64.9 30% 20% 10% 0% 2015 2016 2017 2018 Taxable Bonds 54EC Bonds Banks/ FIs ECB
Slide 35: Funds Raised During The Period
Funds Raised During The Period Rs. Crores 12M Q4 Category FY15 FY16 FY17 FY18 FY 17 FY 18 (A) Long Term Capital Gains Bonds 5,338 6,477 7,663 9,565 2,151 4,137 Tax Free Bonds - 1,000 - - - - Institutional Bonds/ Subordinate Debt 29,200 15,526 18,600 26,145 9,980 9,720 Foreign Currency Borrowings 6,6
Slide 36: Funds Raised During The Period (Long Term)
Funds Raised During The Period (Long Term) Total Funds raised 41,190 31,255 28,495 47,400 (Rs. Cr.) % age 100% 3.2 7.8 90% 16.2 24.7 26.4 80% 26.9 13.0 70% 20.2 60% 20.7 50% 40% 70.9 65.3 30% 55.2 49.7 20% 10% 0% 2015 2016 2017 2018 Taxable Bonds 54EC Bonds ECB Tax Free Bonds 36
Slide 37: Financial Highlights
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Slide 38: Loan Book as at end of 12M FY18 increased to Rs. 2,39,449 cr
Loan Book as at end of 12M FY18 increased to Rs. 2,39,449 cr against Rs. 2,01,929 cr as at end of 12M FY17, registering a growth of 19%. Outstanding borrowings at end of 12M FY18 stands at Rs. 1,98,791 cr. Net worth as at end of 12M FY18 increased to Rs. 35,491 cr against Rs. 33,326 cr as at end of
Slide 39: Key Financial Highlights
Key Financial Highlights 14% 12.30% 12.51% 11.64% Yield on Loan Assets & Cost of Funds 12% 10.55% Yield = Ratio of interest income to average interest earning loan 10% assets Cost of funds = Ratio of finance costs to average borrowings, 8% 8.36% 8.50% 8.13% without foreign exchange fluctuation gain/
Slide 40: Key Financial Highlights
Key Financial Highlights Times 1.70 Interest Coverage Ratio 1.63 1.64 1.65 1.60 1.56 Interest Coverage Ratio = Ratio of Profit 1.55 1.50 before Interest & Tax to Interest 1.50 1.45 1.40 2015 2016 2017 2018 Times 7.0 Debt Equity Ratio 6.08 5.91 6.0 5.60 5.03 Debt Equity = Ratio of Total Borrowings to
Slide 41: Key Financial Highlights
Key Financial Highlights % 25 20.38 21.18 19.56 19.39 20 Capital Adequacy Ratio 15 17.48 18.43 16.52 16.84 10 5 3.04 2.90 2.75 2.55 0 Minimum Requirement as per RBI Guidelines : 15% 2015 2016 2017 2018 Capital Adequacy ratio = Ratio of Owned Funds to Risk Weighted Assets Tier-I Tier-II Total 25% 20%
Slide 42: Key Financial Highlights
Key Financial Highlights Rs. Earnings per Share 40 (Face Value of Rs. 10 per share) 35 30 31.63 25 28.50 26.63 20 23.53 Earnings per Share = Ratio of PAT to outstanding Equity 15 shares. 10 2015 2016 2017 2018 Rs. 200 Book Value per Share (Face Value of Rs. 10 per share) 150 168.75 179.71 144.91 125
Slide 43: Standalone Balance Sheet (abridged)
Standalone Balance Sheet (abridged) Rs. Crores 12M Particulars FY 15 FY 16 FY 17 FY 18 Liabilities Shareholders Funds 24,857 28,618 33,326 35,491 Borrowings 151,024 169,106 167,517 198,791 Deferred Tax Liabilities (Net) 107 50 40 67 Other Liabilities 7,187 8,579 8,353 12,135 Total Liabilities 183,17
Slide 44: Standalone Profit & Loss Statement
Standalone Profit & Loss Statement Rs. Crores 12M Q4 Particulars FY15 FY16 FY 17 FY 18 FY 17 FY 18 Interest Income 20,072 23,471 22,936 21,749 5,717 5,445 Less: Finance Costs 11,845 14,283 13,450 13,830 3,425 3,743 Net Interest Income 8,227 9,188 9,486 7,919 2,292 1,702 Other Operating Income 157 16
Slide 45: Thank You
Thank You 45