MoP - Ministry of Power

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RURAL ELECTRIFICATION CORPORATION
LIMITED (REC)
1. Rural Electrification Corporation Limited (REC) was
incorporated as a Company under the Companies
Act, 1956 in the year 1969 with the main objective of
financing rural electrification schemes in the country.
Subsequently, in the year 1992, REC was notified
as a Public Financial Institution under Section 4A
of the Companies Act, 1956. In the year 1998, REC
was registered as a Non-Banking Financial
Company (NBFC) under Section 45 IA of the RBI
Act, 1934. The Government. of India upgraded REC
as a Schedule “A” Enterprise in the year 2001. REC
was granted Mini Ratna Grade-I Status by Govt. of
India in the year 2002. The mandate/object clause
of REC was expanded in the year 2002 to include
financing of all projects including transmission and
4. HIGHLIGHTS OF PERFORMANCE
4.1 Over the last five years, REC recorded substantial
growth in its performance parameters. The highlights
4.2 Memorandum of Understanding
The performance of the Corporation in terms of
Memorandum of Understanding signed with the
Government of India in the Ministry of Power for the financial
year 2006-07 has been rated as “Excellent”. This was the
14th year in succession that the Corporation has received
“Excellent” rating since the year 1993-94 when the first
MOU was signed with the Government.
4.3 Share Capital
There was no additional subscription to the Equity Share
Capital during the year 2006-07 and the Paid-up Equity
Share Capital of REC as on 31st March, 2007 stood at
CHAPTER - 22.5
generation without any restriction on population,
geographical location or size.
2. REC has continued to grow, since its inception in 1969,
as a lead institution for financing schemes for providing
extension and improvement in the supply of electricity
in the rural areas, electrification of villages, dalit bastis
and households Below Poverty Line (BPL), and
energisation of agricultural pumpsets.
3. Besides attending to its core objectives of financing
schemes for extending and improving the rural electricity
infrastructure, REC has started funding large/mega
generation projects, and transmission and distribution
projects, which are critical to the projected addition of
installed capacity during the Tenth and Eleventh Plans.
of performance of REC for the year 2006-07 along with
the comparative figures for the preceding four years
are given below :-
(Rs. in Crore)
2002-03 2003-04 2004-05 2005-06 2006-07
Loan sanctioned 12125 15978 16316 18771 32925
Loan Disbursed 6607 6017 7885 8007 13733
Recovery of Dues 6673 5003 6817 5434 6585
Resource Mobilisation 4213 3988 8501 9063 9438
Profit before Tax 768 803 1038 831 1006
Profit after Tax 578 612 801 638 660
Networth 2862 3264 3779 4198 4013
Dividend 174 183 235 191 177
Business per employee 15.07 16.55 21.98 19.01 29.11
Rs.780.60 crore, which is wholly subscribed by the Govt.
of India, against the Authorised Share Capital of
Rs.1200 crore
4.4 Mobilization of Funds
The amount mobilized from the market during the year
2006-07 was Rs.9437.74 crore, which includes Rs.899.80
crore by way of syndicated loan from commercial banks,
Rs. 7352.89 crore by way of capital gains tax exemption
bonds, and Rs. 314.80 crore by way of non-priority sector
bonds. The domestic debt instruments of REC continued