2 Bonuses, 4.5 Dividend: Maharatna PSU Turns 1.25 Lakh To 3.35 Lakh In 1-Yr; Buy?

Leading Maharatna PSU, REC Ltd will hold its meeting of Board of Directors on April 30, 2024 to consider financial results and final dividend for the financial year 2023-24. Analysts from Prabhudas Lilladher are optimistic on the stock and issued buy recommendation with target price of Rs 515 apiece. The brokerage firm has suggested to keep the stop loss at Rs 425/share.

Last trading price of REC Ltd share on BSE is Rs 456.85 per share, implying potential return of 12.73% if shareholders decide to buy REC share now. REC shares offered highly attractive return of 264% in last 1-year. More details below:

REC Turns 1.25 Lakh To Rs 3.35 Lakh In 1-Year: The price of REC Ltd share on April 27, 2023 was quoted at Rs 125.05 per share. If you had purchased 1000 shares on April 27, 2023 at the cost of Rs 125.05 per share (investment Rs 1,25,050 lakh), you would have got a corpus of Rs 3,30,882.3 lakh as on April 27, 2024 considering REC offered 264.60% return during this span till April 27, 2024. You would have got a net profit of Rs 2,05,832.3 lakh. It is worth mentioning that REC offered dividend of Rs 4.5/share with ex-dividend date as March 28, 2024. If we add the dividend income too, you would have got a total corpus of 3,35,382.3 lakh and a net profit of Rs 2,10,332.3 lakh as on April 27, 2024. So, your investment of Rs 1,25,050 lakh precisely would have become 3,35,382.3 lakh in 1 year.

REC To Soon Mull Results, Dividend: According to the BSE filing of REC dated April 24, 2024, "a meeting of the Board of Directors of REC Limited will be held on Tuesday, April 30, 2024 inter-alia for the following:-
1. To consider and approve audited financial results (standalone & consolidated) of the Company for the quarter and year ended March 31, 2024.
2. To consider and recommend final dividend, if any, for the financial year 2023-24."

REC Declares Incorporation of Subsidiary: The exchange filing added, "this is to inform that Bhadla-III Power Transmission Limited (CIN: U42202DL2024GOI430036) has been incorporated as Wholly Owned Subsidiary of REC Power Development & Consultancy Limited (a Wholly Owned Subsidiary of REC Limited). The said company is also subsidiary company of REC Limited, in terms of the provisions of Section 2(87) of the Companies Act, 2013."

REC Shares Performance & Return: The 52-week high price of REC shares on BSE is Rs 524.00 per share (as on 08/02/2024) and 52-week low price is Rs 124.05 per share (as on 27/04/2023), respectively. REC has a market capitalisation of Rs 1,20,298.84 crore. REC shares fell 2.82% in last 3-months, gave return of 72% in last 6-months, jumped 375% in last 2-years, and gained 316% in last 5-years.

PL Gives Buy Call: The analyst said, "the stock is indicating a trend reversal. Traders can buy and accumulate it for an upside target of Rs 515. Stop loss will be at Rs 425."

REC Technical: The score is 64.2 and stock is technically neutral. Stocks with score above 70 are considered as technically Strong and below 35 are considered weak. RSI is 54.9, RSI below 30 is considered oversold and above 70 overbought. MFI is 44.0, MFI below 30 is believed to be oversold and above 70 overbought. FII/FPI have decreased holdings from 20.60% to 19.91% in Mar 2024 quarter. Number of FII/FPI investors increased from 867 to 921 in Mar 2024 quarter. Mutual Funds have increased holdings from 8.32% to 9.48% in Mar 2024 quarter, as per Trendlyne data.

REC Dividend History: REC Ltd announced 36 dividends since September 8, 2008. In last 12-months, REC announced an equity dividend amounting to Rs 15.35 per share. At the current share price of Rs 456.85, REC offers dividend yield of 3.36%, according to the Trendlyne data.

REC Bonus History: REC announced 2 bonuses since September 28, 2016. The last Bonus that REC declared was in the ratio 1:3 with ex-bonus date as August 17, 2022, according to Trendlyne.

REC Financials: The PSU announced 18% growth in its Net Interest Income (NII) to Rs 4,159 crore for the October-December period. Its net profit for the December 2024 quarter soared by 14% from last year to Rs 3,269.3 crore. The Maharatna's asset quality bettered sequentially, with gross NPA improving to 2.78% from 3.14% in September. Net NPA declared at 0.82% from 0.96% in the previous quarter. Its quarterly disbursements stood at Rs 46,358 crore, up 56% from last year.

About REC Ltd: REC is a Maharatna Central Public Sector Undertaking under the Ministry of Power. It is a leading infrastructure finance company. Its business activities involve financing projects in the complete power sector value chain, be it generation, transmission or distribution. It provides financial assistance to state electricity boards, state governments, central/state power utilities, independent power producers, rural electric cooperatives and private sector utilities through its extensive network of 22 offices across the country.

Disclaimer: The stock has been picked from the brokerage report of Prabhudas Lilladher. Greynium Information Technologies, the Author, and the respective Brokerage House are not liable for any losses caused as a result of decisions based on the article. Goodreturns.in advises users to check with certified experts before taking any investment decision.