REC (RECLTD) Q4 05/06 earnings summary

Executive summary

• FY2005-06 loan sanctions reached a record Rs.18,771 crore, up from Rs.16,316 crore; disbursements also set a record at Rs.8,007 crore.

• Operational income rose 18% to Rs.1,935 crore, while reported PAT fell to Rs.637.51 crore from Rs.781.36 crore, mainly reflecting lower one-time rescheduling income and additional prior-year tax.

Financial highlights

• Total income was Rs.2,245.06 crore versus Rs.2,302.09 crore; PBT was Rs.829.83 crore versus Rs.1,036.54 crore.

• PAT was Rs.637.51 crore versus Rs.781.36 crore, after earlier-year tax and prior-period adjustments; basic and diluted EPS was Rs.8.17 versus Rs.10.01.

• Operational income increased to Rs.1,934.98 crore from Rs.1,636.87 crore; one-time rescheduling income declined to Rs.121.68 crore from Rs.546.69 crore.

• Sanctions rose to Rs.18,771 crore; disbursements reached Rs.8,006.56 crore, while recoveries declined to Rs.5,433.81 crore from Rs.6,817 crore, partly due to a large prior-year one-time receipt.

Outlook and guidance

• RGGVY targeted infrastructure works in 40,000 villages during FY2006-07, with rural electrification across India targeted by 2009.

• A five-year Reforms-to-Results programme aimed to facilitate at least Rs.50,000 crore of disbursements for rural transmission and distribution improvements.

• Generation disbursements were targeted to double in FY2006-07 and treble by 2008; FY2006-07 generation sanctions had already reached Rs.3,710 crore at the report date.