REC shares slip 2% despite 29% YoY jump in Q1 profit

REC shares declined 2% to Rs 400.6 in Friday’s trade on the BSE, slipping from the day’s high of Rs 408.8, after the company announced its Q1 results for the quarter ended June 2025 (Q1FY26).

The company reported a 29% year-on-year rise in consolidated net profit at Rs 4,465.71 crore, compared to Rs 3,460.19 crore in the same quarter last year. On a sequential basis, profit grew 3.6% from Rs 4,309.98 crore in the March quarter. The growth was driven by strong operational revenues, effective cost controls, and a favourable interest income trajectory.

REC’s consolidated revenue rose 12.6% to Rs 14,731.45 crore in Q1FY26, up from Rs 13,078.66 crore in Q1FY25.

As of June 30, 2025, the company’s consolidated net worth stood at Rs 80,440.44 crore, up from Rs 72,936.19 crore a year ago. REC maintained a debt-equity ratio of 6.31 and a total debt-to-assets ratio of 0.80. Its Capital Adequacy Ratio (CRAR) remained strong at 23.98%.

Asset quality improved, with the gross and net credit-impaired asset ratios falling to 1.05% and 0.24%, respectively, compared to 2.61% and 0.82% a year earlier. The provision coverage ratio also remained robust.

The company declared a first interim dividend of Rs 4.60 per equity share for FY26. The record date for eligibility is Friday, August 1, 2025.

Additionally, REC has fixed Thursday, August 14, 2025, as the record date for the final dividend of Rs 2.60 per share for FY25, subject to shareholder approval at the upcoming Annual General Meeting.

REC share price target

According to Trendlyne, the average target price for REC is Rs 522, indicating an upside of about 30% from current levels. Of the 13 analysts covering the stock, the consensus rating is ‘Strong Buy’.

Also read: Bajaj Finance shares slide 6% after Q1 show fails to cheer D-Street

REC shares have declined over 20% in 2025 and are down 34% over the past 12 months. The company’s current market capitalisation stands at approximately Rs 1,05,881 crore.

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