REC Ltd

Price story Before the numbers, the tape. A stock price moves through four repeating seasons: a flat base (stage 1), an advance (2), a top (3), a decline (4). Where the price sits in that cycle frames everything below.

REC Ltd trades at ₹355, in a downtrend and 77 weeks into that stage. That is −1.9% against its own 200-day average. It sits at 55% of a 52-week range of ₹318 to ₹385. On relative strength it has been ahead of the NIFTY 500 on a trailing-13-week view for 1 straight week.

Today the stock is in a downtrend — week 77 of stage 4, confirmed. At ₹355 it trades −1.9% versus its 200-day average and sits at 55% of its 52-week range (₹318–₹385).

Against the market, two honest reads. Cumulative: over the last 10.3 years the stock moved +469% while the NIFTY 500 moved +274% — ahead of the index over the full window. Recent form: on a trailing-13-week view the stock has been ahead for 1 straight week — the ribbon below is that same metric, week by week.

What would end the trend, mechanically: two Friday closes in a row below the 200-day line. That is the exit rule — no debates.

→ The trend is one thing; the bill is another. Are you paying up for it? Next: the P/BV sits at the 76th percentile of its own range.

Valuation For a bank we price the book, not the earnings: P/BV is what the market pays for each ₹1 of the bank's net worth. A bank below 1× book is priced below the value of what it owns, net of what it owes.

REC Ltd trades at 1.1× P/BV, at the pricey end of its own range (76th percentile). Its long-run median P/BV is 0.8×, measured across 10.4 years of weekly readings. This places the multiple against the stock’s own record, and says nothing about what the business is worth.

Today's P/BV of 1.1× is at the pricey end of its own range (76th percentile), against a long-run median of 0.8× measured over 10.4 years of weekly readings. This is a comparison against the stock's own history — not a claim about what it is worth.

Why the multiple sits where it does: over the past year book value grew while the price moved −11.4% — the price ran ahead of the book, pushing the multiple up its own range.

The price move, decomposed: over 5y, of the +25.6%/yr price move, ~+18.1%/yr came from book-value growth and ~+7.5 pp from the multiple (expanding); over 10y, of the +16.8%/yr price move, ~+12.9%/yr came from book-value growth and ~+3.9 pp from the multiple (expanding). The split is the honest approximate (price return minus book-value growth); it makes the rally itself visible instead of hiding it behind the percentile.

Put together: the multiple is full against its own past, so the story rests on the book-value line underneath it, not the multiple.

→ Cheap or dear rides on the earnings. Are they actually growing? Next: the fundamental stage — where the business sits in its arc, and how growth has compounded.

Stage: Topping out Every business sits somewhere on a fundamental arc, and this page names the spot before anything else. The last twelve quarters of revenue, profit and EPS growth — plus the return the business earns on its capital — are read as curves: Deteriorating (the curves are falling), Turning around (a trough has just formed and the last few quarters lift off it), Improving (the climb off the trough is sustained), Consistent (steadily positive with healthy returns), Topping out (still high but decelerating from the peak). When the curves genuinely disagree the read is Mixed; too little history is No read. CAGR (compound annual growth rate) is the smooth yearly pace that turns the starting value into the latest one — the fairest way to compare growth across different time spans. Read the columns together: if the 1-year number towers over the 10-year, recent growth is running hotter than the long-run trend. A dash means that window is not held, or the base year was a loss (where a growth rate is not meaningful).

REC Ltd reads as topping out on its fundamental arc. Topping out — revenue, profit and EPS growth have decelerated hard (revenue growth +20.3% at its peak → +2.0% latest) while ROE still reads 19.2%. The read is built from 11 quarters across 4 curves, on full evidence.

Why it matters: decelerating from a peak is where good stories quietly end — the multiple usually notices late.

→ The stage names the trajectory. Next: the revenue line that produces it, quarter by quarter.

4-Factor Sector Score

41.0/100 — rank 5 of 6 in Finance - PSU Lending · 82% evidence confidence

REC Ltd scores 41.0 out of 100 against the 6 companies it is compared with in Finance - PSU Lending, ranking 5. Cheap but unconfirmed: require improving earnings before treating the valuation as an opportunity.

The four contributions add to the total exactly: 5 + 15.8 + 14.5 + 5.7 = 41. This is the SAME number shown on the sector comparison — it is computed once, for the whole peer set, and read here.

What would change it: The read weakens if ROA rolls over or gross NPA rises while sector-relative strength deteriorates.

Revenue For a bank, revenue is everything the franchise earns — interest on the loan book plus fee and other income.

REC Ltd reported ₹14,435 Cr of income in the Jun 26 quarter, −2.0% year on year. Over 10 years it has compounded at 9.5% a year. The last full year, FY26, came in at ₹59,584 Cr. The last four reported quarters add to ₹59,203 Cr.

REC Ltd reported ₹14,435 Cr of income in the Jun 26 quarter, −2.0% year on year. Over 10 years it has compounded at 9.5% a year. The last full year, FY26, came in at ₹59,584 Cr. The last four reported quarters add to ₹59,203 Cr.

FY26 revenue came in at ₹59,584 Cr (+5.7% on the year), capping 10 years at 9.5% compound. The latest quarter (Jun 26) printed ₹14,435 Cr, −2.0% year on year.

Pace check: the last four quarters averaged +2.3% growth against the decade's 9.5% — the current year is running slower than its own long-run rate.

Acceleration check: trailing-twelve-month revenue grew +2.0% over the last 4 quarters against +9.4%/yr over the last 8 — rolling over; TTM profit −5.1% vs +4.7%/yr — rolling over.

→ Revenue slipped — did the net margin hold as it scaled? Next: 29.0% this quarter (−1.3 pp YoY).

Net margin Net margin — what the bank keeps of every ₹100 of revenue after every cost, provision and tax. It is the cleanest single margin we can read for a lender.

REC Ltd's net margin is 29.0% in the Jun 26 quarter, −1.3 percentage points against the same quarter a year ago. Across 13 fiscal years the net margin has ranged 16.6% to 29.8%. The current quarter sits inside that band.

REC Ltd's net margin is 29.0% in the Jun 26 quarter, −1.3 percentage points against the same quarter a year ago. Across 13 fiscal years the net margin has ranged 16.6% to 29.8%. The current quarter sits inside that band.

The latest quarter's net margin is 29.0%, −1.3 pp against the same quarter a year ago. Across 13 fiscal years the net margin has ranged 16.6%–29.8%.

Why: the numbers show the net margin move clearly, but the cost lines behind it sit below what we hold — so we state the move without inventing its driver.

→ The net margin slipped — did that reach the bottom line? Next: profit −6.1% in the latest quarter.

Net profit Net profit is what survives every cost, interest and tax — the number EPS, dividends and book value all grow from.

REC Ltd earned ₹4,193 Cr of net profit in the Jun 26 quarter, −6.1% year on year. Full-year FY26 profit was ₹16,308 Cr. The 10-year compound rate is 11.1%. That is 29.0% of the quarter's revenue. The same quarter a year earlier earned ₹4,466 Cr.

REC Ltd earned ₹4,193 Cr of net profit in the Jun 26 quarter, −6.1% year on year. Full-year FY26 profit was ₹16,308 Cr. The 10-year compound rate is 11.1%. That is 29.0% of the quarter's revenue. The same quarter a year earlier earned ₹4,466 Cr.

Jun 26 profit was ₹4,193 Cr, −6.1% year on year. On the full year, FY26 printed ₹16,308 Cr (+2.7%), and the 10-year compound rate is 11.1%.

🚨 Why profit moved: revenue contributed −2.0% and the margin −1.3 pp — the quarter was revenue-led, with the margin roughly flat.

Pace comparison, last four quarters: profit −4.8% vs revenue +2.3%. Profit is growing slower than sales — costs are eating the growth before it reaches the bottom line.

→ Profit is up — how clean is the loan book behind it? Next: we hold no quarterly loan-book numbers — the section says so plainly.

Asset quality — the ladder Gross NPA is the slice of the loan book where repayments have stopped. Net NPA is what remains after the money already set aside against those loans. Falling is healing; rising is damage arriving.

Loan-book quality history is not available for REC Ltd, so this section names the gap rather than estimating a ratio. No gross or net non-performing-asset series is filed in a form this page can read, and none is inferred from the profit line. The income, margin and return sections above carry the evidence this business does report.

We do not hold quarterly loan-book quality numbers for this bank, so this section states that plainly rather than working around it.

Why: loan-book quality is the engine room of a bank, and its drivers — slippages, recoveries, provisioning — sit below what we hold for this name; the sections around it carry the reads we can stand behind.

→ Behind the profits — is the book itself still growing? Next: revenue grew +5.7% in FY26.

The loan book We read the loan book through revenue — when the book grows, revenue grows with it. It is a rough proxy, and we say so: rate moves and fee swings can shift it a few points in any one year.

REC Ltd's revenue grew +5.7% in FY26 to ₹59,584 Cr, so the book is growing. The latest quarter ran −2.0% year on year. The net margin on that income is 29.0%, −1.3 percentage points against a year ago. Interest income is a proxy for the book; rate moves can shift it a few points in any one year.

FY26 revenue was ₹59,584 Cr, +5.7% on the year, and the latest quarter ran −2.0% year on year. The net margin on that revenue is 29.0% this quarter (−1.3 pp YoY) — growth with a narrowing margin on it.

The synthesis: a lender compounds when the book grows while the margin holds and the loan book stays clean — gross NPA is the loan-quality read we carry here.

→ Does all of this actually earn its keep on equity? Next: ROE is 20%.

Returns on equity and assets Two numbers rate a bank: ROE — what it earns on shareholder money — and ROA — what it earns on everything it deploys. ROE above ~13–15% earns its keep; below that, growth builds book slowly.

REC Ltd earns a return on equity of 20% in FY26. Its trough over the ladder below was 13% in FY18. For a lender the balance sheet is the operating asset, so equity return and asset return have to be read together.

FY26 ROE came in at 20%, recovered from a FY18 trough of 13%. On assets, the latest reading is about null% — every ₹100 the bank deploys earns roughly null a year. That clears the bar a bank must beat for its book value to compound.

Why ROE moved: profit compounded 11.1% a year over 10 years while the equity base grew more slowly — earnings recovering faster than book value builds is what lifts ROE off a trough.

→ Who owns this bank, and are they adding or leaving? Next: Foreign institutions cut 4.7 points over 8 quarters.

Debt

For a bank, borrowings are raw material, not a warning sign — solvency is read through the returns and the loan book. A manufacturer’s debt is a claim against its profits, so the debt-to-equity lens that works everywhere else misleads on a lender and is not applied here.

A manufacturer’s debt is a claim against its profits; a bank’s borrowings are its inventory — money taken in to be lent out. The debt lens that works everywhere else misleads here, so this page does not apply it. The solvency questions for a bank — is the loan book sound, is the equity earning — are read through the loan-book and returns sections above.

→ Who owns this, and are they adding or leaving? Next: Foreign institutions cut 4.7 points over 8 quarters.

Ownership Who owns the stock, quarter by quarter: promoters (the controlling owners), foreign and domestic institutions, and the public. Steady accumulation by people close to the numbers is a signal; a quiet register is also an answer.

Foreign institutions cut 4.7 points of REC Ltd over 8 quarters, the biggest move on the register. That takes foreign institutions to 15.8% of the company. Domestic institutions moved +2.3 points over the same window, to 17.0%. The register is read on the four disclosed classes only; nothing is inferred between filings.

The register over the last two years — Foreign institutions: −4.7 points over 8 quarters to 15.8%; Domestic institutions: +2.3 points over 8 quarters to 17.0%; Promoters: +0.0 points over 8 quarters to 52.6%.

Why the register moved: rotation — foreign institutions −4.7 points against domestic institutions +2.3 points over 8 quarters, with promoters holding steady — one class of institutions handing the register to the other, not a verdict change by the people closest to the numbers.

→ One last check: does the safety math agree? Next: the balance-sheet safety line.

Safety line The Z-score estimates how far a company sits from balance-sheet distress — above roughly 3 is safe, below roughly 1.8 is the danger zone. It was built for manufacturers, so it is not applied to banks and lenders.

REC Ltd: the Z-score is omitted — it was built for manufacturers, not banks, and applying it here would be theatre. The Z-score was built for manufacturers and is not applied to banks and lenders, so solvency here is read from the capital and asset-quality lines instead.

The safety line in one sentence: the Z-score is omitted — it was built for manufacturers, not banks, and applying it here would be theatre.

Frequently asked questions