State-owned non-banking finance firm REC Ltd has set an ambitious target to increase its loan book to Rs 10 lakh crore ($136 billion) by 2030, with Rs 3 lakh crore ($40.9 billion) allocated for renewable energy projects. This move is significant in light of India’s ambitious goal of achieving 500 GW of renewable energy capacity by 2030. REC Ltd’s current loan book stands at Rs 4.35 lakh crore ($59.5 billion) as of March 31, 2023.
To meet the renewable energy target, India needs to add approximately 50 GW of clean energy capacity annually. Finance plays a crucial role in supporting these projects. REC Ltd’s Chairman and Managing Director, Vivek Kumar Dewangan, stated that they aim to have a loan book of Rs 3 lakh crore specifically for renewable energy projects by 2030, constituting 30% of the total loan book.
Dewangan also mentioned the government’s permission to allocate up to 33% of REC Ltd’s loan book to infrastructure and logistics sectors. The remaining one-third would be dedicated to distribution companies (discoms) and thermal projects. REC Ltd achieved record profits, with Rs 3,001 crore ($409 million) in the March quarter and Rs 11,055 crore ($1.5 billion) in fiscal year 2022-23.
The company’s net worth increased by 13% YoY to Rs 57,680 crore ($7.9 billion) as of March 31, 2023. REC Ltd has been successful in reducing credit-impaired assets and maintaining a comfortable capital adequacy ratio, positioning itself for future growth. It has also ventured into the non-power infrastructure sector, securing substantial sanctions for infrastructure and logistics projects. Additionally, REC Ltd continues to support the renewable energy sector, with significant sanctions in fiscal year 2022-23.
In the past year, REC Ltd sanctioned a total loan of Rs 2.68 lakh crore ($36.6 billion) and disbursed Rs 96,846 crore ($13.2 billion). The company’s strong performance indicates its commitment to driving sustainable development and supporting India’s renewable energy goals.
