NSEI:RECLTD

Stock Analysis Report

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Executive Summary

REC Limited, a public financial institution, provides financing services for power generation, transmission, and distribution projects in India. More Details


Snowflake Analysis

Good value average dividend payer.


Similar Companies

Share Price & News

How has REC's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: RECLTD has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

2.5%

RECLTD

-0.9%

IN Diversified Financial

-1.6%

IN Market


1 Year Return

-27.4%

RECLTD

-27.2%

IN Diversified Financial

-2.2%

IN Market

Return vs Industry: RECLTD matched the Indian Diversified Financial industry which returned -27.3% over the past year.

Return vs Market: RECLTD underperformed the Indian Market which returned -2.5% over the past year.


Shareholder returns

RECLTDIndustryMarket
7 Day2.5%-0.9%-1.6%
30 Day3.8%0.02%1.7%
90 Day2.7%3.9%6.2%
1 Year-21.8%-27.4%-24.5%-27.2%-0.4%-2.2%
3 Year-28.9%-42.8%-47.4%-51.1%-4.4%-9.0%
5 Year25.6%-13.7%5.0%-12.4%40.4%29.8%

Price Volatility Vs. Market

How volatile is REC's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is REC undervalued compared to its fair value and its price relative to the market?

42.6%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: RECLTD (₹102.85) is trading below our estimate of fair value (₹179.33)

Significantly Below Fair Value: RECLTD is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: RECLTD is good value based on its PE Ratio (3.8x) compared to the IN Diversified Financial industry average (10.9x).

PE vs Market: RECLTD is good value based on its PE Ratio (3.8x) compared to the Indian market (16x).


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate RECLTD's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: RECLTD's PB Ratio (0.6x) is in line with the IN Diversified Financial industry average.


Next Steps

Future Growth

How is REC forecast to perform in the next 1 to 3 years based on estimates from 0 analysts?

22.0%

Forecasted Diversified Financials industry annual growth in earnings


In this section we usually present revenue and earnings growth projections based on the consensus estimates of professional analysts to help investors understand the company’s ability to generate profit. But as REC has not provided enough past data and has no analyst forecast, its future earnings cannot be reliably calculated by extrapolating past data or using analyst predictions.

This is quite a rare situation as 97% of companies covered by SimplyWall St do have past financial data.


Next Steps

Past Performance

How has REC performed over the past 5 years?

-1.9%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: RECLTD has high quality earnings.

Growing Profit Margin: RECLTD's current net profit margins (44.2%) are lower than last year (60.9%).


Past Earnings Growth Analysis

Earnings Trend: RECLTD's earnings have declined by 1.9% per year over the past 5 years.

Accelerating Growth: RECLTD's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: RECLTD had negative earnings growth (-8.1%) over the past year, making it difficult to compare to the Diversified Financial industry average (-3.9%).


Return on Equity

High ROE: RECLTD's Return on Equity (15%) is considered low.


Next Steps

Financial Health

How is REC's financial position?


Financial Position Analysis

Short Term Liabilities: RECLTD's short term assets (₹3,420.5B) exceed its short term liabilities (₹696.2B).

Long Term Liabilities: RECLTD's short term assets (₹3,420.5B) exceed its long term liabilities (₹2,420.1B).


Debt to Equity History and Analysis

Debt Level: RECLTD's debt to equity ratio (812.5%) is considered high.

Reducing Debt: RECLTD's debt to equity ratio has increased from 597.7% to 812.5% over the past 5 years.

Debt Coverage: RECLTD's operating cash flow is negative, therefore debt is not well covered.

Interest Coverage: Insufficient data to determine if RECLTD's interest payments on its debt are well covered by EBIT.


Balance Sheet


Next Steps

Dividend

What is REC current dividend yield, its reliability and sustainability?

10.70%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: RECLTD's dividend (10.7%) is higher than the bottom 25% of dividend payers in the Indian market (0.56%).

High Dividend: RECLTD's dividend (10.7%) is in the top 25% of dividend payers in the Indian market (2.35%)


Stability and Growth of Payments

Stable Dividend: RECLTD's dividend payments have been volatile in the past 10 years.

Growing Dividend: RECLTD's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (40.9%), RECLTD's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: Insufficient data to determine if a dividend will be paid in 3 years and that it will be covered by earnings.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

0.3yrs

Average management tenure


CEO

Sanjeev Gupta (59 yo)

0.33

Tenure

₹9,294,630

Compensation

Mr. Sanjeev Kumar Gupta serves as Chairman & Managing Director at REC Ltd. since June 1, 2020. He has been Director of Technical and Whole-Time Director of REC Limited (Formerly REC Ltd. (formerly known as ...


CEO Compensation Analysis

Compensation vs Market: Sanjeev's total compensation ($USD124.89K) is below average for companies of similar size in the Indian market ($USD771.48K).

Compensation vs Earnings: Sanjeev's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Sanjeev Gupta
Chairman0.33yr₹9.29mno data
Jyoti Amitabh
Executive Directorno data₹7.19m0.00011%
₹ 218.0k
Ajoy Choudhary
Director of Finance0.33yrno data0.000010%
₹ 19.8k
Daljeet Khatri
Chief General Manager of Finance & Accountsno datano datano data
Ashok Awasthi
Executive Director of Administration & Estateno datano datano data
S. Batta
Executive Director of Lawno datano datano data
Kalpana Kaul
Executive Director of HR & CCno datano datano data
Vijay Arora
Chief Risk Officer0.33yrno datano data
Sunita Singh
Chief Vigilance Officer3.58yrsno datano data
S. Gaikward
Executive Director of Project Monitoring Divisionno datano datano data
Salil Kumar
General Manager of Vigilanceno datano datano data
R. Anbalagan
Additional General Manager of Generalno data₹3.94mno data

0.3yrs

Average Tenure

59yo

Average Age

Experienced Management: RECLTD's management team is not considered experienced ( 0.3 years average tenure), which suggests a new team.


Board Members

NamePositionTenureCompensationOwnership
Sanjeev Gupta
Chairman0.33yr₹9.29mno data
Praveen Singh
Nominee Director1.33yrs₹180.00k0%
₹ 0
Mritunjay Narayan
Government Nominee Director1.08yrsno datano data

1.1yrs

Average Tenure

58yo

Average Age

Experienced Board: RECLTD's board of directors are not considered experienced ( 1.1 years average tenure), which suggests a new board.


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

REC Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: REC Limited
  • Ticker: RECLTD
  • Exchange: NSEI
  • Founded: 1969
  • Industry: Specialized Finance
  • Sector: Diversified Financials
  • Market Cap: ₹198.183b
  • Shares outstanding: 1.97b
  • Website: https://www.recindia.nic.in

Location

  • REC Limited
  • Core-4
  • SCOPE Complex
  • New Delhi
  • Delhi
  • 110003
  • India

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
532955BSE (Mumbai Stock Exchange)YesEquity SharesININRMar 2008
RECLTDNSEI (National Stock Exchange of India)YesEquity SharesININRMar 2008

Biography

REC Limited, a public financial institution, provides financing services for power generation, transmission, and distribution projects in India. It primarily offers long-term loans, medium-term Loans, and ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/10/30 12:42
End of Day Share Price2020/10/30 00:00
Earnings2020/06/30
Annual Earnings2020/03/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.