REC Ltd Q2 FY26 Earnings Analysis
Published 3 Jul 2026 | Finance | Market Cap: ₹96.4K Cr
Price
₹336
Market Cap
₹96.4K Cr
P/E Ratio
6.0
Revenue Rank
Margin Rank
How does REC Ltd rank in Finance?
Compare REC Ltd against every Finance company this quarter on revenue, margins and earnings-call signals.
Earnings Summary
REC Limited targets loan book growth of 11% to 12% in FY 2025-26, despite elevated prepayments in H1. REC is confident of achieving loan growth of 11% to 12% by the end of FY '26, supported by a committed order book of nearly Rs.
📊 Revenue & Sales Performance
Rank 3- →REC Limited targets loan book growth of 11% to 12% in FY 2025-26, despite elevated prepayments in H1.
- →The company has a committed order book of nearly Rs. 2.5 lakh crores supporting future growth.
- →By 2030, REC aims for a Rs. 10 lakh crores loan book, with renewable energy expected to contribute 30% (~Rs. 3 lakh crores).
- →Highest half-yearly sanctions of Rs. 2.5 lakh crores reflect a 34% growth, with half-yearly disbursements at Rs. 1.15 lakh crores, a 27% increase YoY.
- →The power sector investment requirement over the next 4-5 years is estimated at Rs. 46 lakh crores, offering significant market potential.
- →REC expects continued robust business from state and private sectors, focusing on projects with good revenue streams regardless of ownership.
- →The company foresees growth in renewable portfolio share, distribution, and generation sectors, maintaining NIM between 3.5%-3.75%.
📈 Profitability & Margins
Rank 3- →REC is confident of achieving loan growth of 11% to 12% by the end of FY '26, supported by a committed order book of nearly Rs. 2.5 lakh crores.
- →Profit growth was strong in H1 FY '26, with highest ever half-yearly profits of Rs. 8,877 crores (19% YoY increase).
- →Earnings per share (EPS) improved to Rs. 33.71 per share; book value at Rs. 314.21 per share.
- →The company expects continued good performance in the next two quarters, aiming to maintain or improve profitability.
- →Return on net worth increased to 22.14%, indicating strong capital efficiency.
- →Asset quality improvement and recoveries (e.g., Kaleshwaram prepayment) support stable earnings outlook.
- →Spread and net interest margins targeted to stay within 2.75%-3.5% and 3.5%-3.75%, respectively, despite growth in renewables and competition.
- →Resolution of stressed assets expected in FY '26, which should further stabilize earnings.
🏗️ Capital Expenditure Plans
Yes- →REC has a committed order book of nearly Rs. 2.5 lakh crores indicating strong future capital investment opportunities.
- →Growth expectations include increasing share of renewables, generation, and distribution sectors, reflecting ongoing and future capex.
- →The company is optimistic about growth in sanctioned projects, with generation sanctions increasing from Rs. 53,000 crores in H1 ’25 to Rs. 1,13,000 crores.
- →Distribution sanctions have also grown substantially from Rs. 36,000 crores to Rs. 71,000 crores.
- →REC plans to fund projects based on good revenue streams regardless of government or private ownership.
- →There is a focus on improving infrastructure, reliability, and quality of power distribution, expected to drive capex growth post debt restructuring in DISCOMs.
- →No specific new strategic investments detailed, but ongoing project financing aligned with government and private sector initiatives under NEP 2032.
💰 Fundraising & Capital Structure
Yes- →No specific mention of current or future fundraising through equity during the call.
- →Borrowing cost increased marginally due to risk mitigation measures in foreign currency borrowings.
- →Foreign currency borrowings of Rs. 1,55,000 crores are about 99% hedged.
- →There is focus on managing borrowing costs, with 80-85% of borrowings at fixed cost.
- →No explicit plan disclosed for raising new debt or equity in the near term.
- →Management emphasizes achieving loan growth of 11%-12% despite prepayments, indicating continued lending capacity.
- →RBI's new project financing norms effective October 1, 2025, apply to new projects, potentially impacting future sanctions but not immediate fundraising.
- →Comments suggest fundraising and costs will be carefully optimized without significantly altering the borrowing profile.
📋 Order Book & Pipeline
Yes- →REC Limited has a committed order book of nearly Rs. 2.5 lakh crores as of October 29, 2025.
- →This robust order book supports future growth and underpins the company's confidence in achieving an 11% to 12% loan growth rate in the coming years.
- →With plans to increase the loan book to Rs. 10 lakh crores by 2030, the current order book is a significant foundation toward that target.
- →The company sees a large market potential across various power sector segments including renewables, thermal, hydro, nuclear, storage, transmission, and distribution investment totaling approximately Rs. 46 lakh crores over the next 4-5 years.
Key Metrics
Revenue
Margin
Capex
Fundraise
Order Book
Frequently Asked Questions
What were REC Ltd Q2 FY26 results?
REC Limited targets loan book growth of 11% to 12% in FY 2025-26, despite elevated prepayments in H1. REC is confident of achieving loan growth of 11% to 12% by the end of FY '26, supported by a committed order book of nearly Rs.
What is REC Ltd share price analysis?
REC Ltd currently shows a below-average growth signal. The stock trades at a P/E of 6.0 with a market cap of ₹96,376 Cr. Investors should review the full earnings analysis for detailed insights.
Is REC Ltd planning capital expenditure?
REC has a committed order book of nearly Rs.
This analysis is AI-generated based on publicly available earnings data and concall transcripts. This is not investment advice. Please consult a SEBI-registered advisor before making investment decisions.