REC Limited (NSE: RECLTD, BSE: 532955), a Maharatna company in the power sector, has announced the incorporation of two new wholly owned subsidiaries as part of its network expansion projects. This strategic move aims to strengthen REC's position in the power transmission infrastructure sector.

Key Details of the New Subsidiaries

Project Background

The establishment of these subsidiaries follows a Gazette Notification issued by the Ministry of Power, Government of India, on September 18, 2025. This notification allocated inter-state transmission projects to REC Power Development and Consultancy Limited (RECPDCL), a wholly owned subsidiary of REC Limited.

Role of RECPDCL

RECPDCL has been appointed as the Bid Process Coordinator (BPC) for these projects. Its responsibilities include:

1. Overseeing the selection of bidders for the establishment of the WR-ER Inter-Regional Network Expansion Scheme.
2. Managing the Tariff Based Competitive Bidding (TBCB) process.

Future Plans

After the successful selection of bidders through the TBCB process, both newly incorporated companies are set to be transferred to the respective successful bidders. This transfer will include all assets and liabilities associated with each company.

Regulatory Compliance

This corporate action aligns with Regulation 30 read with Schedule III of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The incorporation of these subsidiaries also complies with Section 2(87) of the Companies Act, 2013.

REC's strategic expansion through these subsidiaries underscores its commitment to enhancing power transmission infrastructure and contributing to India's growing energy needs.

REC , a key player in India's power sector financing, has reaffirmed its loan growth target for the fiscal year 2026 despite a setback in its second-quarter performance and significant early loan repayments.

Q2 Performance and Early Loan Repayments

REC experienced early loan repayments worth ₹49,000.00 crore between July and September 2025, with ₹11,413.00 crore coming from the Kaleshwaram Irrigation Project in Telangana executed by BHEL. These prepayments reduced loan book growth to 6.60% from a potential 16.60%. Despite this, the company remains optimistic about achieving its loan growth target of 11-12% for FY26.

Management Assurance and Stock Performance

REC's management assured analysts that no such prepayments are expected in the remaining two quarters of the financial year ending March 2026. This assurance led to a stock price rally on October 29, following a decline since the company reported earnings on October 17.

Long-Term Vision

REC has set an ambitious long-term goal for itself:

This target requires a compounded annual growth rate of over 13%, underscoring REC's commitment to significant expansion in its loan portfolio over the next several years.

Current Financial Position

As of March 2025, REC has:

• A market capitalization of approximately ₹97,560.00 crore
• A loan book of over ₹5.82 lakh crore

Power Sector Outlook

The company's maintained growth target and long-term vision are underpinned by its positive outlook on the power sector. REC's assessment suggests that the sector remains robust, providing a strong foundation for the company's financing activities and growth strategies.

As a key financial institution in the power sector, REC's performance and outlook provide valuable insights into the broader trends and expectations within India's energy infrastructure development landscape.