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Rural Electrification Corporation Ltd. Key Financial Ratios

NSE:RECLTD | FINANCIAL INSTITUTION

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Profitability Margins

2-year trend showing gross, operating, and net profit margins

FY 2023 - FY 2024

Rural Electrification Corporation Ltd.'s net profit margin of 29.8% in FY2024 reflects excellent profitability, with operating margin at 39.7%.

Understanding Profitability Margins

In FY 2024, Rural Electrification Corporation Ltd. posted an operating margin of 39.7%, a net margin of 29.8%. Operating Margin = EBIT / Revenue; Net Margin = Net Income / Revenue. Typical healthy ranges: Operating 10-20%, Net 5-10%+. Consistent or improving margins indicate strong competitive positioning.

Company Performance

2-year trend showing revenue, gross profit, and net profit

FY 2023 - FY 2024

Rural Electrification Corporation Ltd.'s revenue grew 20.3% to 475.05B and net profit grew 26.7% to 141.45B YoY in FY2024, indicating strong business momentum.

Understanding Company Performance

In FY 2024, Rural Electrification Corporation Ltd.'s revenue grew by 20.3% year-over-year. Revenue is total income from operations. Gross Profit is revenue minus cost of goods. Net Profit is the bottom line after all expenses. Consistent growth across all three signals a healthy, expanding business.

Return on Equity (ROE)

2-year trend showing shareholder returns

FY 2023 - FY 2024

Rural Electrification Corporation Ltd.'s ROE of 20.4% in FY2024 indicates excellent capital efficiency.

Understanding Return on Equity (ROE)

In FY 2024, Rural Electrification Corporation Ltd. reported an ROE of 20.4%. ROE = (Net Income / Shareholders' Equity) x 100. Measures how efficiently the company turns equity into profit. Above 15% is generally strong; above 25% is excellent. Very high ROE may signal high leverage — check alongside debt levels.

Net NPA Ratio

2-year trend showing asset quality

FY 2023 - FY 2024

Rural Electrification Corporation Ltd.'s net NPA ratio of 0.9% in FY2024 indicates strong asset quality.

Understanding Net NPA Ratio

In FY 2024, Rural Electrification Corporation Ltd. reported a net NPA ratio of 0.86%. Net NPA Ratio measures bad loans (after provisions) as a percentage of total loans. Below 2% is healthy for NBFCs; above 3-4% signals stress. A declining trend indicates improving asset quality.

Net Income vs Free Cash Flow

2-year trend comparing profitability with cash generation

FY 2023 - FY 2024

Understanding Net Income vs Free Cash Flow

In FY 2024, Rural Electrification Corporation Ltd.'s free cash flow trailed net income. Free Cash Flow = Operating Cash Flow - Capital Expenditure. For NBFCs, FCF is typically negative because cash outflows for loan disbursements are part of core operations, not traditional capex. A negative FCF here does not signal financial weakness — it usually reflects a growing loan book.

Net Income vs Operating Cash Flow

2-year trend comparing profitability with cash from operations

FY 2023 - FY 2024

Understanding Net Income vs Operating Cash Flow

In FY 2024, Rural Electrification Corporation Ltd.'s operating cash flow trailed net income. Operating Cash Flow is cash generated from core operations. For NBFCs, OCF is often negative because loan disbursements (a core activity) consume cash. Negative OCF alongside rising net income typically reflects aggressive loan book growth, not operational weakness.

Leverage Ratios

Measure a company's financial leverage, liquidity, and ability to meet financial obligations.

Current Ratio Analysis

2-year trend showing short-term liquidity position

FY 2023 - FY 2024

Understanding Current Ratio

In FY 2024, Rural Electrification Corporation Ltd. reported a current ratio of 1.14. Current Ratio = Current Assets / Current Liabilities. For NBFCs, a low current ratio is normal because large short-term borrowings are part of the business model. Liquidity is managed through Asset-Liability Management (ALM), not by maintaining high current ratios.

Interest Coverage Ratio Analysis

2-year trend showing ability to service debt

FY 2023 - FY 2024

Understanding Interest Coverage Ratio

In FY 2024, Rural Electrification Corporation Ltd. reported an interest coverage ratio of 0.6x. Interest Coverage = EBIT / Interest Expense. For NBFCs, interest expense is a core operating cost — their business model relies on the spread between interest earned and interest paid. A low ICR here does not indicate debt stress.

Debt-to-Equity Ratio Analysis

2-year trend showing financial leverage and capital structure

FY 2023 - FY 2024

Rural Electrification Corporation Ltd.'s debt-to-equity ratio of 6.32x in FY2024 reflects elevated leverage even by NBFC standards — warrants monitoring.

Understanding Debt-to-Equity Ratio

In FY 2024, Rural Electrification Corporation Ltd. reported a debt-to-equity ratio of 6.32. Debt-to-Equity = Total Debt / Total Equity. NBFCs naturally operate with high leverage (D/E of 3-7x is typical) because borrowing to lend is their core business. A high D/E here does not indicate financial distress — compare with NBFC peers for context.

Total Debt Analysis

2-year trend showing total debt with year-over-year changes

FY 2023 - FY 2024

Rural Electrification Corporation Ltd.'s borrowings grew 17.1% YoY in FY2024, indicating borrowing growth likely driven by loan book expansion.

Understanding Total Debt

In FY 2024, Rural Electrification Corporation Ltd.'s total debt increased by 17.1% year-over-year. Total Debt includes short-term debt, long-term loans, debentures, and capital leases. For NBFCs, rising debt typically reflects loan book growth, not financial distress. Compare debt growth with loan book and revenue growth for context.

Shares Outstanding

Year-over-year change in diluted shares outstanding

Rural Electrification Corporation Ltd.'s diluted shares remained virtually unchanged in FY2024.

Over 2 years (FY2023–FY2024), diluted shares remained essentially unchanged at 2.63B.

Understanding Shares Outstanding

In FY 2024, Rural Electrification Corporation Ltd.'s diluted shares remained flat by 0.0% year-over-year. Diluted Shares accounts for stock options, warrants, and convertibles. Positive YoY change means dilution (red); negative means buybacks (green). Consistent dilution above 5% annually is a red flag.

Data from audited consolidated filings. For educational purposes only — not investment advice. Last update: FY 2024