Standalone profit before tax surged 11.34% to Rs 2,758.06 crore in Q1 FY22 as against Rs 2,477.05 crore in Q1 FY21. The Q1 earnings were announced during market hours today, 5 August 2021.

During the quarter ended 30 June 2021, India experienced a second wave of COVID-19, including a significant surge of COVID-19 cases. The resultant lockdowns though were less restrictive for economic activity and were concentrated in the most-hit states. However, REC's strong credit profile, access to diversified sources of borrowings and contingency buffers (in the form of liquidity limits from multiple banks apart from High Quality Liquid Assets) has ensured that there is no significant impact on its liquidity position.

Hence, the current crisis will not have any significant impact on the company's ability to maintain its operations, including the going concern assessment. However, the impact will continue to be dependent on future developments, which are uncertain, including, among other things, discovery of mutant coronavirus variants in the country.

The Government of India, as a part of its COVID-19 relief package, announced a liquidity injection to the state discoms in the form of State Govt. guaranteed loans through REC and PFC (Power Finance Corporation) to clear the outstanding dues of Power Generation and Transmission Companies. As on 30 July 2021, the company has already sanctioned and disbursed Rs 67,838 crore and Rs 41,177 crore respectively to the discoms as part of this liquidity package.

REC is a Navratna Central Public Sector Undertaking under the Ministry of Power. It is a leading infrastructure finance company. Its business activities involve financing projects in the complete power sector value chain, be it generation, transmission or distribution. The company provides financial assistance to state electricity boards, state governments, central/state power utilities, independent power producers, rural electric cooperatives and private sector utilities through our extensive network of 22 offices across the country.

Meanwhile, the board has declared an interim dividend of Rs 2 per equity share of Rs 10 each for the financial year 2021-22. Further, REC has fixed Tuesday, 17 August 2021 as the record date for the purpose of ascertaining the eligibility of shareholders for payment of interim dividend on equity paid-up share capital of the company for the FY2021-22.

REC will also be raising funds through issue of unsecured/ secured non-convertible bonds/ debentures through private placement, upto an amount of Rs 85,000 crore, in one or more tranches, subject to approval of shareholders in this regard in the ensuing Annual General Meeting (AGM). The funds will actually be raised, from time to time, during a period of one year from the date of passing of resolution by the shareholders in the ensuing AGM, with the approval of Competent Authority as per powers delegated in this regard, by the board of the company.

The company has also recommended a final dividend of Rs 1.71 per equity share of Rs 10 each for the financial year 2020-21, subject to approval of shareholders at the ensuing AGM. Further, the company has fixed Friday, 17 September 2021 as the record date for the purpose of determining the eligibility of members for the final dividend. The dividend, if declared at the ensuing AGM, will be paid on Thursday, 21 October 2021.

Shares of REC rose 0.36% to Rs 154.90 on BSE. The scrip traded in the range of Rs 152.50 to Rs 157.50 so far.

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