Rec Limited · NSE:RECLTD
Rec — Rural Electrification — Q3 FY2017 Earnings Presentation
35 slides from Rec's earnings presentation, February 2017
Slide 1: Management Presentation: Performance Highlights Q3 & 9M FY17
Rural Electrification Corporation Limited A Navratna PSU Management Presentation Performance Highlights Q3 & 9M FY 17
Slide 2: Table of Contents
Table of Contents REC Overview Operational Performance Asset Quality Borrowing Profile Financial Highlights 2
Slide 3: REC Overview
REC Overview 3
Slide 4: Key Strengths
Key Strengths 1 2 Occupies Strategic Position in the Growth Strong Financial and development of the Position and Profitable Power Sector across the Business country 6 Nodal Agency for major GoI’s power sector 3 Unique and close programmes – DDUGJY, relationship with all UDAY, Power for All etc. majo
Slide 5: Major Milestones in Long & Successful journey
Major Milestones in Long & Successful journey of more than 47 years Jan’ 2017 : CPSE ETF Further Fund Offer (FFO); GoI holding reduced to 59.36%. 2015 : GoI through an Offer for Sale (OFS) divested 5% of its holding; Oversubscribed 5.53 times; GoI holding reduced to 60.64%. 2014 : GoI launched CPSE-
Slide 6: Board of Directors – Experienced Team with sector experience
Board of Directors – Experienced Team with sector experience Was Special Chief Secretary and Development Commissioner in the Govt of AP. Also held Dr. P.V. Ramesh, important position of Principal Finance Secretary, Principal Secretary Department of Health IAS & Family Welfare and Commissioner of I
Slide 7: Board of Directors – Experienced Team with sector experience
Board of Directors – Experienced Team with sector expirence Mr. Arun Singh Served on Board of Union Bank of India & State Bank of India. Was member of Independent Director Committee of Eminent person in PGCIL. Has handled various projects of FAO, UNO 27 years experience in and World Bank as Nation
Slide 8: Shareholding Pattern
Shareholding Pattern Post CPSE ETF FFO in Jan’17 GoI holding stands at 59.36% as on date 8
Slide 9: Shareholding Pattern
Shareholding Pattern Top 10 Share holders as at December 31, 2016 Rank Particulars Shareholding (%) Category 1 President of India 60.64% * POI 2 Life Insurance Corporation of India 7.19% Insurance 3 Eastspring Investments (Singapore) Limited A/C 1.57% FII 4 East Bridge Capital Master Fund Limited 0.
Slide 10: Performance Analysis of REC’s Share Price vis-à-vis NIFTY Indices (1/2)
Performance Analysis of REC’s Share Price vis-à-vis NIFTY Indices (1/2) Since Listing 1Y 3Y 5Y Ann. Vol. S. No. Index Name Index Category in Mar. 2008 (%) (%) (%) (%) (%) 1 NIFTY 50 Broad Based - Large Cap 13.19 12.03 10.49 6.55 22.92 2 NIFTY 100 Broad Based - Large Cap 15.21 13.88 11.72 7.35 22.81
Slide 11: Performance Analysis of REC’s Share Price vis-à-vis NIFTY Indices (2/2)
Performance Analysis of REC’s Share Price vis-à-vis NIFTY Indices (2/2) No. of years No. of S. of years of Index Name FY 09 FY 10 FY 11 FY 12 FY 13 FY 14 FY 15 FY 16 FY 17 No. outperfor- presence mance (out of 9) 1 NIFTY 50 -36.2 73.8 11.1 -9.2 7.3 18.0 26.7 -8.9 10.6 4 - 2 NIFTY 100 -37.6 83.1 10.1
Slide 12: Operational Performance
Operational Performance 12
Slide 13: Sanctions - Composition
Sanctions - Composition Sector-wise breakup of Sanctions in 9M FY17 Rs. Crores 12M Q3 9M Discipline-wise FY 14 FY15 FY16 FY 16 FY 17 FY 16 FY 17 Generation 29,019 24,326 30,794 6,667 6,150 24,396 35,068 T & D (including 39,446 35,135 31,377 4,965 10,446 23,816 28,448 DDUGJY) Short Term Loan 2,275 1,
Slide 14: Sanctions - Composition
Sanctions - Composition Major Projects Sanctioned in 9M FY17 (More than Rs. 1,000 cr) Project Borrower Category Amt (Rs. Cr) Refinancing/Takeover of loan wrt 2x800 MW Andhra Pradesh Power Take-out Sri Damodaram Sanjeevaiah Supercritical TPP Development Company Ltd 8,897 finance at Krishnapatnam, Nel
Slide 15: Disbursements - Composition
Disbursements - Composition Sector-wise breakup of Disbursements in 9M FY17 Rs. Crores 12M Q3 9M Discipline-wise FY 14 FY 15 FY 16 FY16 FY17 FY16 FY17 Generation 12,989 14,123 13,124 3,371 4,629 8,362 16,365 Transmission 4,113 6,286 8,529 1,641 1,649 5,580 5,753 Distribution (including 16,855 20,159
Slide 16: Outstanding Loans – Composition
Outstanding Loans – Composition Customer-wise breakup of Loans as at 9M FY17 Category-wise breakup of Loans as at 9M FY17 Rs. Crores 12M 9M Discipline-wise FY 14 FY 15 FY 16 FY 16 FY 17 Amt % Amt % Amt % Amt % Amt % State 1,11,179 75 1,33,712 75 1,53,941 77 1,57,305 77 1,53,708 76 Joint 13,302 9 14,
Slide 17: Outstanding Loans - Asset Diversification
Outstanding Loans - Asset Diversification PAN India Presence with loan concentration across 28 states and 1 Union Territory J&K 352 Himachal Haryana 1,014 5,762 Punjab Uttarakhand 251 7,909 Assam 2,206 Arunachal 29 Rajasthan Bihar 18,963 UP 8,984 1,270 18,466 Sikkim Madhya Pradesh Nagaland 116 4,673
Slide 18: Outstanding Loans - Loan Concentration
Outstanding Loans - Loan Concentration Major Borrowers (as on December 31, 2016) Amount Outstanding % of Total Loan S.No. Top Ten Borrowers (Rs/ Cr.) Assets 1 Maharashtra State Power Generation Company Limited 13,441 6.66% 2 Tamil Nadu Generation and Distribution Corporation 12,980 6.43% 3 Maharasht
Slide 19: Asset Quality
Asset Quality 19
Slide 20: Asset Quality – NPA position
Asset Quality – NPA position Non-Performing Loan Assets Figures : Rs. Crores 12M H1 9M Particulars FY 14 FY 15 FY 16 FY 17 FY 16 FY 17 Loan outstanding 1,48,641 1,79,647 2,01,278 1,96,652 2,02,885 2,01,937 Gross NPA 490 1,335 4,243 4,824 3,468 4,691 Provision 137 365 1,013 1,267 700 1,301 Net NPA 35
Slide 21: Asset Quality - Restructured Loan Assets
Asset Quality - Restructured Loan Assets Public (State) Private Total Restructured Loans Provision Loan of Rs. 4,562 cr to UPRVUNL upgraded on achieving COD and provision of Rs. 180 cr reversed after completion of 2 years from the date of restructuring during Q3 FY17. Figures : Rs. Crores 12M H1 9M
Slide 22: Borrowing Profile
Borrowing Profile 22
Slide 23: Outstanding Borrowings
Outstanding Borrowings (Rs. Cr.) 1,26,240 1,51,024 1,69,106 1,69,077 1,67,612 % age Approx. 81% of the ECBs are Hedged till maturity (Unhedged ECBs are 12% of the Net worth against permitted 35%). Average maturity period of the outstanding borrowings is approx. 4.12 years 23
Slide 24: Outstanding Borrowings
Outstanding Borrowings Rs. Crores 12M 9M Particulars FY 14 FY 15 FY 16 FY16 FY 17 Institutional, Subordinate & Zero 75,289 97,068 1,09,678 1,09,560 1,10,859 Coupon Bonds Foreign Currency Borrowings 17,621 24,028 21,924 26,370 21,902 Capital Gain Bonds 15,493 15,591 17,164 16,722 19,211 Tax Free Bond
Slide 25: Funds Raised During The Period
Funds Raised During The Period (Rs. Cr.) 31,948 41,190 31,255 23,593 14,797 % age 25
Slide 26: Funds Raised During The Period
Funds Raised During The Period Rs. Crores 12M Q3 9M Category FY 14 FY15 FY16 FY16 FY 17 FY16 FY17 (A) Long Term Capital Gains Bonds 5,350 5,338 6,477 1,576 1,966 4,226 5,512 Tax Free Bonds 6,000 - 1,000 700 - 1,000 - Institutional Bonds/ 17,403 29,200 15,526 4,810 8620 12,631 8,620 Subordinate Debt
Slide 27: Financial Highlights
Financial Highlights 27
Slide 28: Key Financial Highlights
Key Financial Highlights Total Income for 9M FY17 increased to Rs. 18,117 cr against 9M FY16 of Rs. 17,673 cr. registering an increase of 3%. PBT for 9M FY17 increased to Rs. 6,973 cr against 9M FY16 of Rs. 6,273 cr. registering an increase of 11%. PAT for 9M FY17 increased to Rs. 4,927 cr aga
Slide 29: Key Financial Highlights
Key Financial Highlights Yield on Loan Assets & Cost of Funds Yield = Ratio of interest income to average loan assets Cost of funds = Ratio of finance costs to average borrowings, without foreign exchange fluctuation loss amortized. Interest Spreads & Net Interest Margins Interest Spread = Yield min
Slide 30: Key Financial Highlights
Key Financial Highlights Interest Coverage Ratio Interest Coverage Ratio = Ratio of Profit before Interest & Tax to Profit Before Tax Times Debt Equity Ratio Debt Equity = Ratio of Total Borrowings to Net Worth 30
Slide 31: Key Financial Highlights
Key Financial Highlights Capital Adequacy Ratio % Minimum Requirement as per RBI Guidelines : 15% Capital Adequacy ratio = Ratio of Owned Funds to Risk Weighted Assets Return on Average Net Worth Return on Average Net worth = Ratio of PAT to average Net Worth 31
Slide 32: Key Financial Highlights
Key Financial Highlights Earning per Share (Annualised) Rs. (Face Value of Rs. 10 per share) Earning per Share = Ratio of PAT to outstanding Equity shares. Rs. Book Value per Share (Annualised) (Face Value of Rs. 10 per share) Book Value per share = Ratio of Net worth to outstanding Equity shares. 3
Slide 33: Standalone Balance Sheet (abridged)
Standalone Balance Sheet (abridged) 12M 9M Particulars FY 14 FY 15 FY 16 FY 16 FY 17 Liabilities Shareholders Funds 20,669 24,857 28,618 28,014 33,553 20 % YoY Borrowings 1,26,240 1,51,024 1,69,106 1,69,077 1,67,612 Deferred Tax Liabilities (Net) 174 107 50 68 80 Net Worth Rs. 33,553 cr. Other Liabi
Slide 34: Standalone Profit & Loss Statement
Standalone Profit & Loss Statement 12M Q3 9M Particulars FY14 FY15 FY16 FY 16 FY 17 FY 16 FY 17 3% Interest Income 16,806 20,072 23,471 5,987 5,573 17,455 17,218 9M YoY Less: Finance Costs 10,039 11,845 14,283 3,707 3,373 10,530 10,352 Net Interest Income 6,767 8,227 9,188 2,280 2,200 6,925 6,866 To
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