REC Limited , a Maharatna public sector Non-Banking Financial Company (NBFC) under India's Ministry of Power, has released its Business Responsibility and Sustainability Report (BRSR) for the financial year April 1, 2025 to March 31, 2026 — its 57th Annual Report. The disclosures are made on a consolidated basis and have received reasonable assurance from M/s Corporate Professionals. The report covers all nine principles of the National Guidelines on Responsible Business Conduct (NGRBC), spanning environmental stewardship, social responsibility, and governance integrity.

Company Overview and Financial Profile

REC Limited (CIN: L40101DL1969GOI005095) was incorporated in 1969 and is headquartered at Core 4, SCOPE Complex, 7, Lodhi Road, New Delhi-110003, with its corporate office at REC World Headquarters, Plot no. I-4, Sector 29, Gurugram-122001. The company is listed on both the National Stock Exchange of India Limited and BSE Limited, with a paid-up capital of ₹2,633.22 crore.

The following table summarises REC's key financial and operational parameters for FY2025-26:

REC's customer base spans Government entities including State Governments and central/state power utilities, Independent Power Producers (IPPs), and private sector borrowers engaged in infrastructure and power projects. Power Finance Corporation Limited (PFC) holds 52.63% of REC's shares, making it the holding company. REC Power Development and Consultancy Limited (RECPDCL) is a wholly-owned subsidiary, with 28 further subsidiaries under RECPDCL.

ESG Performance Highlights

Environmental: Decarbonisation and Green Financing

REC's environmental performance in FY2025-26 reflects a significant acceleration in both operational decarbonisation and green lending.

The reduction in Scope 2 emissions was driven by sourcing 100% green power for the Corporate Headquarters through the Green Tariff facility of DISCOM-DHBVNL, and the commissioning of 54 kWp of new rooftop solar installations across three Regional Offices in Panchkula, Lucknow, and Vadodara. These additions complement the existing 979 kWp rooftop solar facility at the Corporate Office and the 40 kWp facility at RECIPMT. Cumulatively, these installations generated 3,167 MWh of clean energy in FY2025-26, avoiding 2,248 tonnes of CO2 emissions.

REC also achieved 100% conversion of its office fleet to EV/Hybrid vehicles during the financial year. On the financing side, renewable projects funded by REC avoided approximately 12.2 million tonnes of CO2, with 7.6 million tonnes directly attributed to REC financing using the PCAF methodology. REC sanctioned 2 Ultra Super Critical Thermal Power Projects amounting to ₹22,228.25 crore in FY2025-26, reflecting its commitment to higher-efficiency power generation.

Social: Workforce, Well-being, and Community Development

As at the end of FY2025-26, REC's total employee count stood at 1,213, comprising 590 permanent and 623 other-than-permanent employees. The company reported 14 differently abled permanent employees.

All 590 permanent employees received 100% coverage under health insurance, accident insurance, and paternity benefits. Return-to-work and retention rates for permanent employees on parental leave stood at 100% for both male and female categories. Zero complaints were filed under POSH, discrimination, child labour, forced labour, wages, or human rights categories in FY2025-26. The company also recorded zero safety incidents, fatalities, and lost-time injuries during the year.

For FY2025-26, REC allocated a total CSR outlay of ₹338 crore toward national priorities including healthcare, education, and rural development. CSR projects spanned 80 initiatives across multiple states, covering medical equipment procurement, mobile medical units, solar smart classrooms, skill development, and infrastructure for vulnerable communities. Aspirational district expenditure included ₹7,78,58,197 in Siddharth Nagar (Uttar Pradesh), ₹3,98,92,855 in West Sikkim, ₹2,75,86,734 in Banka (Bihar), and ₹2,52,61,113 in Muzafarpur (Bihar), among others.

Governance: Accountability and Compliance

REC's governance framework is anchored in its status as a Central Public Sector Enterprise (CPSE) under the Ministry of Power, adhering to DPE Guidelines, the Companies Act 2013, and SEBI (LODR) Regulations 2015.

Key governance milestones in FY2025-26 include:

• Became the first Indian public sector NBFC to secure ISO 31000:2018 accreditation for its Enterprise Risk Management (ERM) framework
• Upgraded to ISO 27001:2022 certification for data privacy
• Achieved 100% training coverage for Board of Directors and KMPs on NGRBC principles
• Assessed 100% of private sector borrowers (loan sanctions) for ESG compliance
• Assessed 100% of onboarded vendors for ESG compliance
• Received 4 prestigious ESG Awards for ESG excellence and responsible business practices
• Implemented ESG incentivisation for ESG-compliant renewable borrowers effective April 2026
• Maintained zero data breaches and zero conflict-of-interest complaints

Regarding regulatory compliance, NSE and BSE imposed a fine of ₹44,67,480 on REC for non-compliance with Board composition requirements under Listing Regulations, owing to the non-availability of Independent Directors. REC noted that the power to appoint Directors vests with the President of India through the Ministry of Power, and the company has been requesting the appointment of requisite Independent Directors.

REC was classified as "Excellent" by the Department of Public Enterprises (DPE) for its performance in FY2024-25; its FY2025-26 evaluation is under process.

Grievance Redressal and Stakeholder Engagement

REC maintained active grievance redressal mechanisms across all stakeholder groups. In FY2025-26, 80 community complaints were filed and all were disposed of by March 31, 2026. Investor complaints (other than shareholders) totalled 456, all resolved with nil pending. Shareholder complaints stood at 14, all resolved, with 1,053 additional requests/clarifications received and responded to during the year, except three resolved post March 31, 2026.

Public Policy and Inclusive Development

As a National Project Implementing Agency (NPIA) for the PM Surya Ghar: Muft Bijli Yojana (total outlay: ₹75,021 crore), REC facilitated over 3.3 million rooftop solar connections in FY2025-26, contributing approximately 10 GW of distributed renewable capacity. REC also serves as the nodal agency for the Revamped Distribution Sector Scheme (RDSS) across 19 states.

On inclusive procurement, REC's sourcing from MSMEs reached 64.42% of total procurement by value in FY2025-26, significantly exceeding the Government-mandated minimum of 25%. Total loans and advances with related parties for FY2025-26 were ₹63 lakh, representing employee advances under standard policy. The number of days of accounts payable stood at 39 in FY2025-26, compared to 24 in FY2024-25, primarily due to a ~24% decrease in procurement volume and timing differences related to government-led schemes such as RDSS.

REC Limited has completed the sale and transfer of its project-specific special purpose vehicle (SPV), Ryapte Power Transmission Limited, to The Tata Power Company Limited. The transaction, finalized on July 30, 2026, involved the transfer of the entire shareholding comprising 50,000 equity shares held by REC Power Development and Consultancy Limited (RECPDCL), a wholly owned subsidiary of REC Limited. The deal was executed after RECPDCL received the necessary consideration from the successful bidder selected through a tariff-based competitive bidding process.

The total consideration for the sale amounts to ₹10,86,62,034, which includes applicable taxes, professional fees, and reimbursement of expenses. With effect from July 30, 2026, Ryapte Power Transmission Limited is no longer a subsidiary of RECPDCL or REC Limited. The Share Purchase Agreement (SPA) was executed between RECPDCL and The Tata Power Company Limited on the same date. The buyer does not belong to the promoter or promoter group of REC Limited, and the transaction is not classified as a related party transaction.

Transaction Details

Regulatory Compliance and Financial Impact

The disclosure was made pursuant to Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The filing confirms that the transaction does not fall within the purview of related party transactions and is not in the nature of a slump sale. Furthermore, the sale is outside any Scheme of Arrangement, rendering Regulation 37A of the LODR Regulations not applicable.

The consideration for the sale and transfer of the SPV was determined in accordance with the guidelines issued by the Ministry of Power, Government of India. According to the disclosure, the turnover, revenue, income, and net worth contributed by Ryapte Power Transmission Limited during the last financial year were negligible. This suggests that the divestiture has minimal impact on the consolidated financial statements of REC Limited for the preceding period.

What the Numbers Show

The negligible financial contribution of Ryapte Power Transmission Limited indicates that this divestiture is likely part of a portfolio optimization strategy rather than a response to underperformance or distress. By exiting through a competitive bidding process and transferring assets and liabilities simultaneously, REC Limited has effectively de-risked its exposure to this specific transmission project while realizing a defined exit value. The involvement of The Tata Power Company Limited, a major player in the power sector, suggests a strategic alignment in asset management within the industry.