Slide 1: Rural Electrification Corporation Limited Management Presentation Q1 FY18
Rural Electrification Corporation Limited A Navratna PSU Management Presentation Performance Highlights Q1 FY 18
Slide 2: Table of Contents
Table of Contents India - Power Sector – Empowering India REC Overview Operational Performance Asset Quality Borrowing Profile Financial Highlights 2
Slide 3: India - Power Sector – Empowering India
India - Power Sector – Empowering India 3
Slide 4: Generation
Generation Installed Capacity 329 GW Generating Generation Stations 900 Units 2200 Generation Peak Demand Average 160 GW PLF 63% Source : POSOCO & CEA 4
Slide 5: Transmission
Transmission Transmission Lines 3,74,706 CKM 7000 Transformation Substations Capacity 7,43,070 MVA Transmission LINES 100 nos -765KV 26 ISTS Transmission >1300 nos – 400KV LINES Licensees >3200 nos– 220KV 10 nos – HVDC Bipole BtB India has the 3rd largest Grid in the World Source : POSOCO & CEA 5
Slide 6: Annual Per Capita Consumption of Electricity (kwh)
Annual Per Capita Consumption of Electricity (kwh) Per capita Consumption World - 2,674 Brazil - 2,516 South Africa - 3,904 China - 4,310 Japan - 7,371 Russia - 7,481 Singapore - 8,160 USA - 12,077 Source : CEA & Wikipedia 6
Slide 7: “Power for All” - Demand by 2021-22 (MW)
“Power for All” - Demand by 2021-22 (MW) 47% Source : CEA 7
Slide 8: “Power for All” - Installed Capacity by 2021-22 (MW)
“Power for All”- Installed Capacity by 2021-22 (MW) 329 GW 540 GW MW 73% 35% 68% 67% Estimated fund requirement for generation capacity addition – INR 10,33,400 Crores during the period 2017-22 Source : CEA 8
Slide 9: “Power for All” - Transmission Line Capacity by 2021-22 (CKM)
“Power for All” - Transmission Line Capacity by 2021-22 (CKM) 26% Estimated fund requirement for Transmission capacity addition including Transformation – INR 2,60,000 Crores during the period 2017-22 Source : CEA 9
Slide 10: “Power for All” - Transformation Capacity by 2021-22 (MVA)
“Power for All” - Transformation Capacity by 2021-22 (MVA) 32% Estimated fund requirement for Transmission capacity addition including Transformation – INR 2,60,000 Crores during the period 2017-22 Source : CEA 10
Slide 11: Renewable Energy in India
Renewable Energy in India Sources Potential (%) Potential (GW) India has voluntary commitment to reduce Wind Power (Onshore) 11% 103 Solar 83% 749 emission intensity by 33% - 35% from 2005 levels Small Hydro 2% 20 by 2030. Biomass /Bagasse 3% 23 It seeks to achieve about 40% cumulative electric
Slide 12: “Power for All” – Distribution Modernization by 2019
“Power for All” – Distribution Modernization by 2019 Present By March 2019 AT & C Loss Below 15% 24.6% Gap ACS -ARR Zero Rs.0.6/U Power Supply 24X7 19.9 Hrs Power for All 12
Slide 13: REC Overview
REC Overview 13
Slide 14: Key Strengths
Key Strengths 1 2 Occupies Strategic Position in the Growth and development of the Strong Fundamentals Power Sector across and Profitable Business India 8 Nodal Agency for Unique and close 3 providing 24x7 quality relationship with all power to all 600,000 major players – Public & villages of India
Slide 15: Major Milestones in Long & Successful journey of ~48 years
Major Milestones in Long & Successful journey of ~ 48 years Jan’ 2017 : CPSE ETF Further Fund Offer (FFO); GoI holding reduced to 59.36%. Mar’ 2017 : CPSE ETF FFO - 2; GoI holding reduced to 58.86%. 2015 : Govt. of India (GoI) through an Offer for Sale (OFS) divested 5% of its holding; Oversubscribe
Slide 16: 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 17: Board of Directors – Experienced Team with sector experience
Board of Directors – Experienced Team with sector expirence Served on Board of Union Bank of India & State Bank of India. Was member of Committee Mr. Arun Singh of Eminent person in PGCIL. Has handled various projects of FAO, UNO and World Bank Independent Director as National Consultant. 27 years
Slide 18: Shareholding Pattern
Shareholding Pattern As at 31.03.2017 As at 30.06.2017 Gol , 58.86 Gol , 58.86 Others, a ww Others, a 1.37 Insurance 171 Insurance Corporates, Cos., 6.38 Corporates, Cos., 5.67 1.73 1.57 soe Individual/ MFs, 3.79 Individual MFs, 2.45 HUF, 6.43 HUF, 6.7 18
Slide 19: Shareholding Pattern
Shareholding Pattern Top 10 Share holders as at June 30, 2017 Rank Particulars Shareholding (%) Category 1 President of India 58.86 POI 2 Life Insurance Corporation of India 4.78 INS 3 East Bridge Capital Master Fund Limited 1.25 FPI 4 The Prudential Assurance Company Limited 1.22 FPI 5 CPSE ETF 1.1
Slide 20: Performance of REC’s Share Price vis-à-vis Major Indices in Last 1 Year
Performance of REC’s Share Price vis-à-vis Major Indices in Last 1 Year Source REC Share & Nifty : NSE BSE Sensex : BSE REC’s stock has constantly tend to outperform the broader market and earned great returns for the equity share holders of the Company. 20
Slide 21: Operational Performance
Operational Performance 21
Slide 22: Sanctions - Composition
Sanctions - Composition Sector-wise breakup of Sanctions in Q1 FY18 Rs. Crores 12M Q1 Discipline-wise FY 14 FY15 FY16 FY17 FY 17 FY 18 Generation 28,724 23,778 27,828 28,209 8,374 17,769 Renewable Energy 295 548 2,966 2,090 170 1,258 150 % Project T&D 39,446 35,135 31,377 49,047 4,763 14,241 Loans Q
Slide 23: Sanctions - Composition
Sanctions - Composition Major Projects Sanctioned in Q1FY18 (More than Rs. 500 cr) Project Borrower Category Amt (Rs. Cr) 2x660 MW Udangudi Stage-I Coal based Thermal Supercritical Thermal Power Project in TANGEDCO 10,453 Projects Tuticorin District of Tamil Nadu 1x500 MW Thermal Power Station in Da
Slide 24: Disbursements - Composition
Disbursements - Composition Sector-wise breakup of Disbursements in Q1 FY18 Rs. Crores 12M Q1 Discipline-wise FY 14 FY 15 FY 16 FY 17 FY17 FY18 Generation 12,854 13,828 12,820 21,697 3,917 4,706 26 % Renewable Energy 135 295 304 1,618 157 180 Project Transmission 4,113 6,286 8,529 10,520 1,835 1,328
Slide 25: Outstanding Loans – Composition
Outstanding Loans – Composition Customer-wise breakup of Loans as at Q1 FY18 Category-wise breakup of Loans as at Q1 FY18 Rs. Crores 12M Q1 Discipline-wise FY 14 FY 15 FY 16 FY 17 FY18 Amt % Amt % Amt % Amt % Amt % State 1,11,179 75 1,33,712 75 1,53,941 77 1,51,976 75 1,61,185 78 Joint 13,302 8 14,6
Slide 26: Outstanding Loans - Asset Diversification
Outstanding Loans - Asset Diversification PAN India Presence with loan concentration across 28 states and 1 Union Territory J&K 367 Himachal Haryana 594 5,797 Punjab Uttarakhand 255 8,110 2,256 Assam Arunachal Rajasthan 24 Bihar 19,227 UP 10,341 1,270 21,596 Sikkim Madhya Pradesh Nagaland 104 5,158
Slide 27: Outstanding Loans - Loan Concentration
Outstanding Loans - Loan Concentration Major Borrowers (as on June 30, 2017) Amount Outstanding % of Total Loan S.No. Top Ten Borrowers (Rs Cr.) Assets 1 Maharashtra State Power Generation Company Limited 13,456 6.48% 2 Maharashtra State Electricity Distribution Company Limited 9,985 4.80% 3 Rajasth
Slide 28: Asset Quality
Asset Quality 28
Slide 29: Asset Quality – NPA position
Asset Quality – NPA position Non-Performing Loan Assets Figures : Rs. Crores 12M Q1 Particulars FY 14 FY 15 FY 16 FY 17 FY18 Loan outstanding 1,48,641 1,79,647 2,01,278 2,01,929 2,07,802 Gross NPA 490 1,335 4,243 4,873 5,412 Provision 137 365 1,013 1,639 1,821 Net NPA 353 970 3,230 3,234 3,591 29
Slide 30: Asset Quality - Restructured Loan Assets
Asset Quality - Restructured Loan Assets Rs. Crores Public (State) Rs. Crores Private Rs. Crores Total Restructured Loans Provision Figures : Rs. Crores 12M Q1 Particulars FY 15 FY 16 FY 17 FY 18 Public (State Sector) 11,682 12,470 10,925 10,941 Provision - Public 321 436 475 494 Private 4,746 8,588
Slide 31: Borrowing Profile
Borrowing Profile 31
Slide 32: Outstanding Borrowings
Outstanding Borrowings Rs. Crores 12M Q1 Particulars FY 14 FY 15 FY 16 FY 17 FY 18 Institutional, Subordinate & Zero 75,289 97,068 1,09,678 1,13,449 1,13,472 Coupon Bonds Foreign Currency Borrowings 17,621 24,028 21,924 21,081 19,912 Capital Gain Bonds 15,493 15,591 17,164 19,477 19,890 Tax Free Bon
Slide 33: Outstanding Borrowings
Outstanding Borrowings (Rs. Cr.) 1,26,240 1,51,024 1,69,106 1,67,517 1,68,284 % age Approx. 87% of the ECBs are Hedged till maturity. Average maturity period of the outstanding borrowings is approx. 4.02 years 33
Slide 34: Funds Raised During The Period
Funds Raised During The Period Rs. Crores 12M Q1 Category FY14 FY15 FY16 FY17 FY 17 FY 18 (A) Long Term Capital Gains Bonds 5,350 5,338 6,477 7,663 1,626 1,508 Tax Free Bonds 6,000 - 1,000 - - - Institutional Bonds/ Subordinate Debt 17,403 29,200 15,526 18,600 - - Banks, FIs, etc. 1,195 - - - - - Fo
Slide 35: Funds Raised During The Period
Funds Raised During The Period (Rs. Cr.) 31,948 41,190 31,255 28,495 1,508 % age 35
Slide 36: Financial Highlights
Financial Highlights 36
Slide 37: Key Financial Highlights
Key Financial Highlights Total Income for Q1 FY18 stands at Rs. 5,662 cr against Q1 FY17 of Rs. 6,051 cr. PBT for Q1 FY18 is Rs. 1,890 cr against Rs. 2,053 cr. in Q1 FY17. PAT for Q1 FY18 is Rs. 1,301 cr against Rs. 1,421 cr for Q1 FY17. Net worth as at end of Q1 FY18 increased to Rs. 34,614
Slide 38: Key Financial Highlights
Key Financial Highlights Yield on Loan Assets & Cost of Funds Yield = Ratio of interest income to average interest earning loan assets Cost of funds = Ratio of finance costs to average borrowings, without foreign exchange fluctuation gain/loss amortized. Interest Spreads & Net Interest Margins Inter
Slide 39: 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 39
Slide 40: 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 40
Slide 41: Key Financial Highlights
Key Financial Highlights Earnings per Share Rs. (Face Value of Rs. 10 per share) Earnings per Share = Ratio of PAT to outstanding Equity shares. Rs. Book Value per Share (Face Value of Rs. 10 per share) Book Value per share = Ratio of Net worth to outstanding Equity shares. 41
Slide 42: Standalone Balance Sheet (abridged)
Standalone Balance Sheet (abridged) Rs. Crores 12M Q1 Particulars FY 14 FY 15 FY 16 FY 17 FY 18 Liabilities Shareholders Funds 20,669 24,857 28,618 33,326 34,614 Borrowings 1,26,240 1,51,024 1,69,106 1,67,517 1,68,284 Deferred Tax Liabilities (Net) 174 107 50 40 56 Other Liabilities 5,770 7,187 8,57
Slide 43: Standalone Profit & Loss Statement
Standalone Profit & Loss Statement Rs. Crores 12M Q1 Particulars FY14 FY15 FY16 FY 17 FY 17 FY 18 Interest Income 16,806 20,072 23,471 22,936 5,890 5,463 Less: Finance Costs 10,039 11,845 14,283 13,775 3,553 3,343 Net Interest Income 6,767 8,227 9,188 9,161 2,337 2,120 Other Operating Income 212 157
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