{"id":13376,"date":"2018-03-20T17:52:43","date_gmt":"2018-03-20T12:22:43","guid":{"rendered":"https:\/\/blog.fundsindia.com\/blog\/?p=13376"},"modified":"2018-03-20T17:52:43","modified_gmt":"2018-03-20T12:22:43","slug":"rural-electrification-corporation-limited","status":"publish","type":"post","link":"https:\/\/www.fundsindia.com\/blog\/equities\/rural-electrification-corporation-limited\/13376","title":{"rendered":"Rural Electrification Corporation Limited"},"content":{"rendered":"<p><strong>Power play with attractive dividend yield\u2026.<\/strong> Rural Electrification Corporation Ltd. (REC) is one of the leading public Infrastructure Finance Company in India with a network of 18 project offices including 5 Zonal and 3 sub offices along with 1 Training centre. REC\u2019s business model spans across the value chain of power infrastructure financing along with consultancy and advisory for power distribution and transmission projects catering to large and marquee state run power generation and transmission-distribution companies.<\/p>\n<p><strong>Valuation:<\/strong> REC\u2019s profitability will continue to remain under pressure over FY17-20E as provisions are likely to remain high given the increasing stress in power sector and high level of private restructured loan book (~5.6% of loans). However, the attractive dividend yield of ~7.5% will restrict any further fall in the stock price. Notably, REC consistently rewards its shareholders with healthy dividend, showing that the company is investor friendly. Further, REC is diversifying its portfolio toward renewable projects. Hence, we recommend BUY rating on the stock with a target price (TP) of Rs146 (P\/ABV of 0.8x for FY20E).<\/p>\n<p><a href=\"https:\/\/www.fundsindia.com\/blog\/wp-content\/uploads\/2018\/03\/Research-Report-Rural-Electrification-Corporation-Ltd.pdf\">Research Report &#8211; Rural Electrification Corporation Ltd<\/a><\/p>\n<p><i>Investments in equity shares, debentures, etc., are not obligations of, or guaranteed by Wealth India Financial Services Pvt. Ltd., and are subject to investment risks.\u00a0<a href=\"http:\/\/pages.fundsindia.com\/pages\/disclaimer-equities\/\">Click here<\/a>\u00a0to read our full disclaimer.<\/i><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Power play with attractive dividend yield\u2026. Rural Electrification Corporation Ltd. (REC) is one of the leading public Infrastructure Finance Company in India with a network of 18 project offices including 5 Zonal and 3 sub offices along with 1 Training centre. REC\u2019s business model spans across the value chain of power infrastructure financing along with [&hellip;]<\/p>\n","protected":false},"author":14,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[59],"tags":[542],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v17.3 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Rural Electrification Corporation Limited<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.fundsindia.com\/blog\/equities\/rural-electrification-corporation-limited\/13376\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Rural Electrification Corporation Limited\" \/>\n<meta property=\"og:description\" content=\"Power play with attractive dividend yield\u2026. 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