REC Ltd. reported a 12% jump in its standalone net profit in the last financial year and maintaining the same growth rate in the current fiscal will be “good enough”, according to Chairperson Jitendra Srivastava.

“At the macro level, you have a lot of upheavals in the geopolitical sphere,” he said during a conversation with NDTV Profit on Friday. “You have greater fluidity in the market.”

“If we can maintain our current 12% growth for FY26, I think that would be good enough,” Srivastava added.

The power sector lender recorded a 5.7% rise in its consolidated net profit at Rs 4,310 crore in the quarter ended March 31, 2025.

He credited the robust performance in FY25 to a “huge uptick” in sanctions, which reached Rs 3.37 lakh crore. Disbursals increased to Rs 1.91 lakh crore from Rs 1.6 lakh crore. “Both of these, combined with a reduction in our non-performing assets, have contributed to our bottom line,” the CMD said.

The company also delivered dividends worth Rs 4,713 crore to shareholders, alongside significant income tax contributions to the Union government. Srivastava emphasised a high return on net worth of almost 21%, underscoring that REC is a “fairly good financially managed company”.

REC’s net interest margin saw a slight improvement, rising to 3.63% in FY25 from 3.57% in the previous fiscal. “That means we have been successful in bringing down our cost of capital,” he said. However, he also anticipated “some tightening” in the current fiscal.

The state-owned company has been successful in reducing its cost of capital every fiscal. A challenge for REC is the easing of liquidity due to the rate cuts by the Reserve Bank of India, according to Srivastava. “It becomes easier for agencies that may not have the requisite expertise to lower their interest rates and try to finance projects,” he said.

Despite credit cost pressures, he said, REC maintains a disciplined lending approach. “We still look at the fundamentals of the company. We don’t compromise on the fundamentals of our borrower. Unless the borrower is good, unless the project is financially viable, we don’t finance it,” Srivastava added.

Shares of REC ended 1.89% lower at Rs 384.8 apiece on the BSE on Friday, compared to a 1.1% decline in the benchmark Sensex.

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