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Rural Electrification Corporation Ltd.

BSE: 532955 Sector: Financials
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OPEN 152.50
VOLUME 943331
52-Week high 223.80
52-Week low 114.85
P/E 5.41
Mkt Cap.(Rs cr) 30,216
Buy Price 0.00
Buy Qty 0.00
Sell Price 153.00
Sell Qty 17.00
OPEN 152.50
CLOSE 152.35
VOLUME 943331
52-Week high 223.80
52-Week low 114.85
P/E 5.41
Mkt Cap.(Rs cr) 30,216
Buy Price 0.00
Buy Qty 0.00
Sell Price 153.00
Sell Qty 17.00

Rural Electrification Corporation Ltd. (RECLTD) - Director Report

Company director report


The Shareholders

Your Directors have pleasure in presenting the Forty Seventh Annual Report togetherwith the Audited Financial Statements of your Company for the financial year ended March31 2016.


1.1 The highlights of performance of the Company for the financial year 2015-16 were asunder with comparative position of previous year's performance:-

(Rs. in crore)
Parameter FY 2015-16 FY 2014-15
Loans Sanctioned (excluding sanctions under DDUGJY-RE and DDG) 65471.10 61421.37
Disbursements (including subsidy under DDUGJY-RE and DDG) 50630.81 46446.82
Recoveries (including interest) 47921.00 32005.56
Total Operating Income 23638.35 20229.53
Profit Before Tax 8045.21 7427.04
Profit After Tax 5627.66 5259.87

1.2 Financial Performance

The total operating income of your Company for the financial year 2015-16 has increasedby 17% to RS.23638.35 crore from RS.20229.53 crore during the previous year. The profitafter ta Rs.increased by 7% to RS.5627.66 crore from RS.5259.87 crore for the previousyear.

Loan asset book of your Company as on March 31 2016 has increased by a healthy 12% toreach a historic high of RS.201278 crore from RS.179647 crore in the previous year.The outstanding borrowings as on March 31 2016 were RS.169106 crore. Earnings Per Share(EPS) for the financial year ended March 31 2016 is RS.56.99 per share of :10/- each. Net Worth of the Company as on March 31 2016 has increased by 15% to RS.28618crore from RS.24857 crore in the previous year.

1.3 Dividend

In addition to interim dividend of RS.12.00 per share paid in February 2016 the Boardof Directors of your Company have recommended a final dividend of RS.5.10 per share forthe financial year 2015-16 which is subject to approval of the Shareholders in theensuing Annual General Meeting. The total dividend for the financial year 2015-16 willwork out to RS.17.10 per share representing 171% of the paid-up share capital of theCompany as against ‘ 10.70 per share representing 107% of the paid-up share capitalof the Company in the previous year. The total dividend pay-out for the financial year2015-16 will amount to RS.1688.55 crore (excluding dividend distribution tax of RS.341.71crore).

1.4 Share Capital

The issued and paid up share capital of the Company as on March 31 2016 was RS.987.46crore divided into 987459000 equity shares of RS.10/- each against the Authorized ShareCapital of RS.1200 crore divided into 1200000000 equity shares of RS.10/- each.

The President of India held 65.64% of the paid up equity share capital of the Companyas on March 312015. During the financial year 2015-16 the President of India actingthrough Ministry of Power Government of India disinvested/sold 49372950 equity sharesi.e. 5% of total paid up capital of the Company through Offer For Sale (OFS) on April 82015 and further divested/sold 27588 equity shares i.e. 0.003% of total paid up capitalof the Company through an off-market transaction under Central Public Sector EnterprisesExchange Traded Fund (CPsE EtF) on April 10 2015. Accordingly as on March 31 2016 thePresident of India held 60.64% of the paid up equity share capital of the Company.


The Company sanctioned loans worth RS.65471.10 crore during the financial year2015-16 as against RS.61421.37 crore in the previous year excluding sanctions underDeendayal Upadhyay Gram Jyoti Yojana- RE Component (DDUGJY-RE) and DecentralisedDistributed Generation (DDG). The state-wise and category-wise break-up of loanssanctioned during the financial year are given in enclosed Table-1 and Table-2respectively. The cumulative amount of sanctions made since inception up to March 31 2016was : 681479.23 crore including DDUGJY-RE and DDG project cost (capital subsidy andloan) upto XI five year plan. The cumulative state-wise position of sanctions up to thefinancial year 2015-16 is given in enclosed Table-3.


A total sum of RS.46025.83 crore was disbursed during the financial year 2015-16 asagainst RS.42818.46 crore in the previous year. Further an amount of 5023.99 crore(subsidy of RS.4541.44 crore under RE component of DDUGJY and subsidy of 63.54 croreunder DDG and loan component of RS.419.01 crore) under DDUGJY has been disbursed. Thecumulative amount disbursed since inception up to March 31 2016 was Rs. 329538.39 croreexcluding subsidy under DDUGJY-RE and DDG. The state-wise disbursements and repayment ofloan by borrowers during the financial year 2015-16 together with cumulative figures andoutstanding as on March 31 2016 are given in enclosed Table-4.


4.1 The Company gives utmost priority to the timely realization of its dues towardsprincipal interest etc. The amount due for recovery including interest for performingassets during the financial year 2015-16 was : 48278 crore as compared to32661 crore during the previous year. The Company recovered a total sum of Rs. 46641crore towards performing assets during the financial year 2015-16 as against ' 31412crore during the previous year. The Company achieved recovery rate of 96.61% for thefinancial year 2015-16.The overdues from defaulting borrowers pertaining to PerformingAssets as on March 31 2016 was Rs. 1637 crore. Further an amount of 1280 crore wasrecovered during the financial year 2015-16 towards earlier year dues and NPAs as againstRs. 593.56 crore during the previous year.

4.2 Your Company's Non-Performing Assets (NPAs) continue to be at low levels. As onMarch 31 2016 the Gross NPAs of the Company was Rs. 4243.57 crore {including loansclassified as NPAs due to restructuring/ non-achievement of DCCO amounting to 811.33crore}. The percentage of NPA as a percentage of Gross Loan Assets stood at 2.11% as onMarch 31 2016 as compared to 0.74% as on March 31 2015. The net NPA as on March 31 2016was ' 3230.30 crore which is 1.60% of Gross Loan Assets. Further no doubtful loans havebeen rescheduled by the Company during the financial year 2015-16.

The details of loans rescheduled during the financial year 2015-16 and their positionas on March 31 2016 are as under:

(Rs. in crore)
Particulars FY 2015-16 FY 2014-15
No. of Borrowers 23 27
Standard Loans Amount Outstanding 22829.88 35024.03
No. of Borrowers 3 0
Sub-Standard Loans Amount Outstanding 1402.44 0
No. of Borrowers 26 27
Total Amount Outstanding 24232.32 35024.03

*The Rescheduled loan amount includes Rs. 5649.12 crore wherein the first repaymentdate was extended due to delayed commissioning of the respective project.


5.1 Summary of Financial Results

The summary of audited financial results of the Company for the financial year endedMarch 31 2016 is as under:

(Rs. in crore)




FY 2015-16 FY 2014-15 FY 2015-16 FY 2014-15
Revenue from Operations 23638.35 20229.53 24012.88 20384.34
Other Income 117.93 158.52 117.05 165.55
Total Income 23756.28 20388.05 24129.93 20549.89
Finance Costs 14283.12 11844.61 14282.35 11839.59
Other Operating Expenses 338.10 313.44 604.74 351.78
Provisions and Contingencies 1089.85 802.96 1096.18 806.18
Total Expenses 15711.07 12961.01 15983.27 12997.55
Profit Before Tax 8045.21 7427.04 8146.66 7552.34
Provision for Taxation 2417.55 2167.17 2455.24 2207.92
Profit After Tax 5627.66 5259.87 5691.42 5344.42
Less : Appropriations
Transfer to Special Reserve u/s 36(1)(viii) of the Income Tax Act 1961 1900.00 1629.00 1900.00 1629.00
Transfer to Reserve for Bad & Doubtful Debts u/s 36(1)(viia) of the Income Tax Act 1961 390.00 353.00 390.00 353.00
Dividend 1688.55 1056.58 1688.55 1056.58
Dividend Distribution Tax 341.71 212.17 345.68 214.21
Transfer to Debenture Redemption Reserve 196.59 185.79 196.59 185.79
Transfer to General Reserve 570.00 526.00 572.89 530.76
Surplus carried over to Balance Sheet 540.81 1297.33 597.71 1375.08

5.1.1 Contribution to National Exchequer

During the financial year 2015-16 the Company contributed an amount of Rs. 3749.55crore as compared to Rs. 3134.24 crore in the previous year to National Exchequer in theform of payment of Dividend to the Government of India against its shareholding in theCompany Dividend Distribution Tax Direct Taxes and Service Tax paid including CENVATcredit as detailed below:

(Rs. in crore)
Particulars FY 2015-16 FY 2014-15
Dividend paid to the Government of India 880.19 631.96
Dividend Distribution Tax 293.47 187.26
Direct Taxes 2540.96 2285.04
Service Tax paid including CENVAT credit 34.93 29.98
Total 3749.55 3134.24

5.1.2 Ratio Analysis

A comparative statement of important ratios of the Company for the financial year2015-16 vis-a-vis 2014-15 is as below:

Particulars FY 2015-16 FY 2014-15
Earnings Per Share (Rs.) 56.99 53.27
Return on Average Net Worth (%) 21.05 23.11
Book Value per Share (Rs.) 289.81 251.73
Debt Equity Ratio (times) 5.91 6.08
Price Earnings Ratio (times)* 2.92 6.25
Interest Coverage Ratio (times) 1.56 1.63

*PE Ratio has been calculated on the basis of Closing Price of equity share of REC atNSE as on March 31 2016 & March 31 2015.

5.2 Resource Mobilization

The Company mobilized Rs. 31254.92 crore from the market during the year 2015-16. Thisincludes Rs. 1000 crore by way of Tax Free Secured Redeemable Non-Convertible Bonds Rs.6476.70 crore by way of Capital Gain Tax Exemption Bonds : 15526 crore byway of non-priority sector bonds Rs. 8046.60 crore (i.e USD 1220 million) from ExternalCommercial Borrowings (ECB) and 205.62 crore by way of Official Development Assistance(ODA) loan from Kreditanstat fur Wiederaufbau (KfW) Germany & Japan InternationalCooperation Agency (JICA) Japan. Further an amount of Rs. 20771.78 crore was alsoraised through Commercial Paper (CP).

Cash Credit Facilities

The Company has an approved cash credit/WCDL limit of Rs. 6510 crore for availmentfrom various banks for its day-to-day operations.

5.3 Domestic and International Credit Rating Domestic

The domestic debt instruments of the Company continued to enjoy "AAA" rating- the highest rating assigned by CRISIL CARE India Ratings & Research andICRA-Credit Rating Agencies.


The Company enjoys international credit rating equivalent to sovereign rating of Indiafrom International Credit Rating Agencies Moody's and Fitch which is "Baa3" and"BBB-" respectively.

5.4 Cost of Borrowing

The overall weighted average annualized interest rate of borrowing for the funds raisedduring the financial year 2015-16 was 7.30% p.a. and for the borrowings outstanding as onMarch 31 2016 is 8.21% p.a. As a result your Company was able to deliver debt financingat competitive rates.

5.5 Redemption and Pre-Payment

During the year the Company repaid a sum of Rs. 34892.83 crore. This includesrepayment amounting to Rs. 3.07 crore to the Government of India 2992.80 crore tonon-priority/priority sector bond holders ‘ 4903.25 crore worth of Capital Gain TaxExemption Bonds Rs. 133.93 crore towards Infrastructure Bonds Rs. 10456.14 crore ofExternal Commercial Borrowings and 403.64 crore of Official Development Assistance (ODA)loan. The Company also redeemed long term and short term loans from Banks and FinancialInstitutions of Rs. 475 crore and Commercial Papers of Rs. 15525 crore.

5.6 Deployment of Resources at the close of the year

At the close of the financial year 2015-16 the total resources of your Company stoodat Rs. 206352.97 crore. Out of this Equity Share Capital contributed 987.46 crorereserves and surplus stood at : 27630.30 crore Loans from Financial InstitutionsCommercial Banks and market borrowings through Bonds and Commercial Papers accounted forRs. 169106.38 crore Deferred Tax Liabilities of Rs. 49.75 crore and other liabilities& provisions stood at Rs. 8579.08 crore. These funds were deployed as Long /

Short Term Loans of RS.200265.02 crore (net of provisions RS.1013.27 crore) fixedassets (net of depreciation) of Rs. 150.32 crore (including Capital Work in progress)Investments of Rs. 2466.62 crore Cash & Bank Balances of Rs. 1728.55 crore andother assets of Rs. 1742.46 crore.

5.7 Policy Initiatives

The Company constantly reviews its policies/ procedures from time to time to suitablyalign with market requirements and also with its corporate objectives and applicablestatutory requirements. During the year the Company has adopted/amended various policiesand guidelines such as Integrated Rating Methodology for Renewable Energy projectsIntegrated Rating Guidelines for Coal Mines Financing (State Sector) Long Term InvestmentPolicy Guidelines on Project Financing Framework for Flexible Structuring Guidelines onRefinancing of Project Loans Guidelines on Regulatory Compliance regarding StressedAssets and Policy for CSR assistance under Skill Development.

During the year the Company has modified its existing policy constituted for grantingrebates in interest rates/offering special interest rates and Medium Term Loan (MTLs).

Despite growing competition in the market the Company has been able to maintainhealthy spreads balancing its objectives of business growth and profitability during theyear.


The present scenario of Transmission and Distribution (T&D) industry is much morechallenging in comparison to the past since we have achieved highest ever GenerationCapacity addition during XI plan and further set a target for addition of over 88000 MWduring XII plan from conventional sources. The country is well on its course for achievingthis target and the capacity of around 96% of the target has already been added. Thisachievement shall pose an urgent requirement for creation of requisite transmission anddistribution infrastructure for effective utilization of power. The TRANSCOs and DISCOMsneed to create this infrastructure and enhance their capital expenditure duringforthcoming years to be able to provide reliable robust & efficient system fortransfer of power from generation facilities to sub-stations and up to the consumer end.

The T&D system basically comprises of transmission lines (inter-state andintra-state) Sub-stations switching stations transformers and distribution lines etc.of various voltage levels. Distribution has been identified as the weakest link in thepower value chain and most difficult to deal with due to various reasons. The everincreasing demand for affordable reliable and quality power by various classes ofconsumers makes distribution all the more challenging task. Your Company has alwaysstrived to play an active role in creation of new infrastructure andaugmentation/strengthening of the existing network. Your Company encourages the DISCOMs toexpedite various reform measures and to adopt best practices including modernization andautomation of systems/smart grid IT-enabled systems for metering and consumer servicesother technology interventions in the distribution sector & helps them in improvingtheir operational and financial performance. Since distribution is gateway for all therevenue coming into the power sector it plays a pivotal role in development andsustainability of the power sector.

Major challenges presently being faced by distribution sector includes high level ofaccumulated losses & depleting net worth which is severely hindering their finances.High AT&C losses limited capability to implement capital expenditure plans delay intariff order resulting in creation of regulatory assets carrying cost of these regulatoryassets lack of tariff rationalisation leading to cross subsidy open access issuestimely release of subsidy by State Government delayed revenue collection cycle etc. havecaused a dent in their cash flows. The overall performance of the state distributionutilities has been an issue of concern due to the above facto Rs. Keeping in tune with thetimes and dynamic environment wherein utilities are struggling and striving hard to meetthe consumer expectations your Company today finances entire gamut of distributionprojects broadly with the objectives of system improvement & augmentation lossreduction measures IT-enabling consumer satisfaction etc. Your Company is always readyto consider special dispensation/requirements of DISCOMs based on the prudence/merit andsound appraisal mechanism. A dedicated Strategic Business Group has been set up in theCompany for this purpose.

Your Company is playing a pivotal role in partnering with Ministry of Power Governmentof India in all major initiatives and is committed to improve & turn around the powerdistribution sector in the country by its deep involvement in programme like DDUGJY(Nodal Agency) IPDS NEF (Nodal Agency) FRP (Financial Restructuring Plan) Smart Gridtask force Ujwal DISCOM Assurance Yojana (UDAY) etc. With all these major interventionsyour Company is optimistic that distribution scenario would be much better in not toodistant future when the results and effect of above massive programmes in conjunction withthe reform measures by the respective states starts trickling in and transform the entirelandscape of distribution.

6.1 Major reforms in Distribution Sector

Government of India has made all efforts to intervene in the sector for ensuringoverall development by way of Electricity Act 2003 and various other policy measures suchas National Tariff Policy National Electricity Policy Rural Electrification Policy provide a comprehensive framework and also the blueprint for power sector reforms. Thesector has shown signs of improvement in operational and financial performance during lastfew years which have still to go a long way. The process of un-bundling corporatizationinstituting regulatory commission etc. has already been completed in most of the statesthus increasing their accountability and also providing more autonomy to the DISCOMs.Further some of the DISCOMs have gone ahead in appointing franchisees on case to casebasis in order to improve operational efficiency in particular areas.

In the past decade Government of India (GoI) has launched several programmes to extendthe benefits to the ailing DISCOMs such as R-APDRP with an objective to strengthen theinfrastructure and to reduce the losses RGGVY to ensure last mile connectivity and torelease service connections to BPL R-APDRP for undertaking improvements in urban pocketsand to introduce IT enabling of distribution systems and presently DDUGJY and IPDS.Further NEF - Interest Subsidy Scheme is also under implementation with objective topromote capital investment & expedite the reform process in distribution sector.Government of India has also made its intervention to restructure the loans to enhanceliquidity situation of the DISCOMs in joint participation with State Government by way ofFRP scheme. The financial outlay of DDUGJY is of Rs. 43033 crore (with Rs. 33453 croreas budgetary support from Government of India) and IPDS with total outlay of Rs. 32612crore (with Government budgetary support of Rs. 22727 crore) should provide considerablefillip to the pace of capital investments in distribution sector without putting muchstrain on already stressed balance sheets of DISCOMs. REC is the Nodal Agency forimplementation of DDUGJY and NEF scheme.

REC has been providing counterpart funding for a large number of R-APDRP projects whichaim to reduce the Aggregate Technical and Commercial (AT&C) losses considerably inurban areas. Also REC shall participate in funding of the loan component under DDUGJY andIPDS programmes.

Ministry of Power (MoP) has also been working on Integrated Rating System for all thestate DISCOMs in the country which facilitates realistic assessment of performance. Thesystem would enable these DISCOMs to weigh their strengths & weaknesses and facilitatea focused approach for achieving further improvements in their operational and financialperformance. It will also aid in adoption of consistent approach by Banks/FIs whileconsidering funding proposals of distribution companies.

The introduction of information & communication technology in power distributionsector shall enable the power system to become "SMART" & Near-real-timeinformation shall allow utilities to manage the entire system as an integrated frameworkactively sensing and responding to changes in power demand supply costs quality ofpower. MoP is also working towards ensuring technological interventions throughintroduction of Smart Grid and has already extended financial assistance to several pilotprojects. Similarly better information enables consumers to manage energy use to meettheir needs. The on-going measures under erstwhile R-APDRP programme will set a steppingstone equipping the DISCOMs to integrate with further technical advancements and to makethe grid smarter.

Further to evolve a road map for implementation of smart grids in India MoP hasconstituted India Smart Grid Task Force (ISGTF) an inter-ministerial group. 14 Nos. SmartGrid Pilot Projects had been approved by MoP with 50% Government of India funding to testvarious functionalities in Indian Environment. The objectives of these Pilots cover -Power Quality Management (PQM) providing Advanced Metering Infrastructure (AMI) OutageManagement (OM) Peak Load Management (PLM) and also DG (Distributed Generation) &Micro Grid functionalities. The Government of India is promoting development of 100 smartcities which shall further lead to plethora of requirements and necessities in furtheradoption of technology and best practices in the distribution segment.

As is evident from above interventions Government of India is working on two differentfronts one being to facilitate power to all and second to improve operational &financial performance of the utilities. The results of these measures have already startedto show effects in terms of timely notification of tariffs by regulator in many statesfiling of MYT petitions claiming of Return of Equity in the ARR release of revenuesubsidy by state government etc.

Though so many initiatives have been taken by the Government of India StateGovernments and DISCOMs however the state of distribution segment on the consolidatedlevel remains weak. The DISCOMs are having fragile balance sheets face prolonged projectexecution delays incurring lesser capital expenditure engaging is reduced powerprocurement due to ongoing gap between per unit revenue and cost of supply. Though theutilities are working on reducing this gap through regular tariff filings and demand forReturn on Equity by the DISCOMs however the targets set for performance achievement areregularly being missed by majority of DISCOMs leading to inadequate tariff transmissionthrough the mechanism. The increased capital expenditure on part of DISCOMs may enable thestrengthening of network such that the huge cost burden due to persistently high level ofAT&C losses may be brought down and consequently the quality/reliability of supply tothe end consumers may be ensured.

Ujwal DISCOM Assurance Yojana (UDAY)

The recent initiative by Ministry of Power Government of India through Ujwal DISCOMAssurance Yojana (UDAY) launched in November 2015 is a path breaking reform forrealizing the Hon'ble Prime Minister's vision of affordable and accessible 24x7 power forall. It is another decisive step furthering the landmark strides made in the Power sectorover the past two years with the sector witnessing a series of historic improvementsacross the entire value chain from fuel supply (highest coal production growth in over 2decades) to generation (highest ever capacity addition) transmission (highest everincrease in transmission lines) and consumption (over 2.3 crore LED bulbs distributed).

Financially stressed DISCOMs are not able to supply adequate power at affordable rateswhich hampers quality of life and overall economic growth and development. Efforts towards100% village electrification 24X7 power supply and clean energy cannot be achievedwithout performing DISCOMs. Power outages also adversely affect national priorities like"Make in India" and "Digital India".

Due to legacy issues DISCOMs are trapped in a vicious cycle with operational lossesbeing funded by debt. Outstanding debt of DISCOMs has increased from about ' 2.4 lakhcrore at the end of 2011-12 to about 4.3 lakh crore at the end of 2014-15. UDAY assuresthe rise of vibrant and efficient DISCOMs through a permanent resolution of past as wellas potential future issues of the sector. It empowers DISCOMs with the opportunity tobreak even in the next 2-3 yea Rs. This is through four initiatives (i) Improvingoperational efficiencies of DISCOMs; (ii) Reduction of cost of power; (iii) Reduction ininterest cost of DISCOMs; and (iv) Enforcing financial discipline on DISCOMs throughalignment with State finances.

6.2 National Electricity Fund

REC is the Nodal Agency for National Electricity Fund (NEF) - interest subsidy schemehaving provision of Rs. 8466 crore (against interest subsidy) to be provided over 14years on loan disbursements amounting to Rs. 25000 crore for distribution schemessanctioned during the 2 years viz. 2012-13 and 2013-14. Ministry of Power Government ofIndia shall provide interest subsidy on loans disbursed to the State Power UtilitiesDistribution Companies (DISCOMs) - both in public and private sector to improve theinfrastructure in distribution sector. The scheme is aimed to incentivize much neededinvestment into distribution segment of power sector. The scheme is reform linked andinterest subsidy is payable to the DISCOMs on achievement on reform based parametersoutlined in NEF guidelines. The interest subsidy of 3% to 7% would be provided on loanstaken by power utilities in distribution sector for all approved Distribution SectorInfrastructure capital works.

During the financial year 2012-13 & 2013-14 your Comapny has already sanctionedprojects of Rs. 25000 crore to 25 DISCOMs in 15 states for taking benefits under NEF. Theutilities from the states of Uttarakhand Madhya Pradesh Haryana Rajasthan AndhraPradesh and Telangana have already benefitted from the interest subsidy of Rs. 16.92 croreapproved under the scheme. The other state DISCOMs will also start taking benefit ofinterest subsidy on loans availed based on their annual achievement on mainly twobenchmark parameters i.e. reduction of AT&C losses & reduction in revenue gap (ACS& ARR).


The Company has been providing funding assistance for power generation transmission& distribution projects besides for electrification of villages. Details of majorfinancing activities during the financial year 2015-16 are as under:

7.1 Generation

During the financial year 2015-16 your Company sanctioned 19 Nos. ofGeneration/R&M loans including 14 Nos. of additional loan assistance with totalfinancial outlay of 27828.44 crore including consortium financing with other financialinstitutions and has disbursed Rs. 12819.53 crore against the ongoing generationprojects.

The sector wise break up of loans sanctioned including additional loan ssistance is asunder:

(Rs. in crore)
Particulars No. of Loans Loan Amount
Fresh Loan 5
Additional Loan 2 25988.26
Fresh Loan 0
Additional loan 12 1840.18
Total 19 27828.44

7.2 Renewable Energy

During the year your Company sanctioned loan assistance of Rs. 2965.72 crore to 11new grid-connected Renewable Energy projects with installed generation capacityaggregating 688 MW which included 9 Solar photo-voltaic projects aggregating 662 MW; 1Biomass project of 6 MW and 1 Wind project of 20 MW. The total cost of these projectsaggregates Rs. 4444.78 crore. Further during the financial year 2015-16 totaldisbursement was Rs. 304.07 crore as detailed below:

Particulars Unit FY 2015-16 FY 2014-15
Projects Sanctioned Nos. 11 8
Capacity of Sanctioned Projects MW 688 193.86
Cost of Projects Rs. crore 4444.78 1768.19
Loan Sanctioned Rs. crore 2965.72 547.92
Loan Disbursed crore 304.07 295.25

7.3 Transmission & Distribution

Your Company continued to play an active role in creation of new infrastructure andimprovement of the existing ones under the transmission and distribution network in thecountry under its T&D portfolio. In line with the Government of India's objective toprovide power for all by creation of infrastructure and also to reduce the AT&Closses your Company has been financing schemes for expansion and strengthening of thetransmission network and more importantly modernizing the distribution system.

During the financial year 2015-16 your Company sanctioned 579 Nos. of Transmission andDistribution schemes involving a total loan assistance of Rs. 23627.61 crore. Thisincludes primary power evacuation schemes associated with generating plants systemimprovement schemes including R-APDRP projects feeder segregation schemes bulk loanschemes intensive electrification schemes and pumpset energisation schemes.

The state-wise and category-wise break-up of loans sanctioned during the financial yearare given in enclosed Table 1 & 2 respectively. The major programmes covered by yourCompany under T&D sanctions in brief are as under:

7.3.1 System Improvement & Bulk Loan

To overcome the system deficiencies and to improve the quality and reliability of powersupply your Comapny finances system improvement schemes based on system studies of anelectrical distribution network considering present status of system capacities connecteddemand voltage profiles and level of losses together with scope for future load growths.

The system improvement programme also includes Bulk loan schemes meant for procurementand installation of meters transformers capacitors conductors poles etc. systemimprovement schemes reduce the AT&C losses to a great extent.

During the year 2015-16 a total of 511 system improvement schemes and bulk loanschemes were sanctioned involving a loan outlay of : 21773.84 crore. Thisincluded: (i) 90 schemes involving a loan assistance of RS.3830.00 crore for financinginvestment in the distribution system by way of installation of essential equipment liketransformers meters capacitors etc.; (ii) 171 schemes for 7186.82 crore for improvingthe distribution system; (iii) 36 schemes involving loan assistance of RS.1317.91 croretowards counterpart funding of Part B of R-APDRP projects; and (iv) 250 schemes for loanassistance of Rs. 10757.02 crore for improving the transmission network.

7.3.2 Intensive Electrification

Schemes under this activity mainly aim at intensive electrification of alreadyelectrified villages. During the year 2015-16 a total of 6 intensive electrificationschemes were sanctioned involving a loan outlay of RS.210.87 crore.

7.3.3 Pumpsets Energisation

REC's loan portfolio also includes extension of loan assistance for energisation ofagricultural pumpsets. During the year 2015-16 under REC financed schemes 213926 Nos.electric irrigation pumpsets were reported as energized. A loan assistance of RS.324.99crore was sanctioned for 26 new schemes during the year under this category. Thestate-wise details and cumulative position of pumpset energized up to March 31 2016 aregiven in the enclosed Table-5.

7.4 Short Term Loans and others

During the financial year 2015-16 your Company has also sanctioned loans assitance ofRS.11049.33 crore to various power utilities in the form of short term loans mediumterm loans & special loans to meet their funds requirement of short/ medium term& working capital etc.

7.5 Financing Activities in North Eastern States

During the financial year 2015-16 a loan assistance of RS.233.16 crore towards costoverrun was sanctioned for Generation scheme to M/s Teesta Urja Limited and M/s DansEnergy Private Limited located in North Eastern Region (Sikkim). A loan assistance ofRS.12.68 crore was sanctioned to M/s Meghalaya Power Transmission Corporation Limited forTransmission projects.

A total sum of RS.839.05 crore was disbursed during the financial year 2015-16 asagainst RS.418.99 crore in the previous year for Generation projects in North Easternstates which include RS.23.20 crore to M/s Lanco Energy Private Limited RS.38.22 crore toM/s Dans Energy Private Limited and RS.777.60 crore to M/s Teesta Urja Limited.

7.6 Appraisal System for Financing

REC has its own methodology for appraisal of Private Sector Power Generation andTransmission Projects and the grading of the State Power Utilities. REC's interest ratesare linked to the grades assigned to the private sector projects and State PowerUtilities. REC along with PFC assists the Ministry of Power in bringing out integratedratings for State Power Distribution Utilities and adopts the ratings as revised byMinistry of Power from time to time to ensure uniformity in approach by various Banks/Financial Institutions. The grading of State Power Utilities is an on-going process basedon various parameters viz. financial technical tariff regulatory measures governmentsupport and management etc.

7.7 New policy/financing initiatives under Strategic Business Group (SBG) andInvestments made during the financial year 2015-16.

The Strategic Business Group (SBG) of the Company formulated policies to tune with thechanges in the regulatory environment in the areas of project loan refinancing flexiblestructuring and monitoring of stressed assets.

The Company has framed a policy for funding of State Sector Coal Mining Projects as anew financing opportunity. The Company also formulated a 'Long Term Investment Policy' toaugment the long term investment opportunities for the Company. Under the ambit of LongTerm Investment Policy the Company has made total investment of 1500 crore in Tier-IBonds of Indian Bank Vijaya Bank & Syndicate Bank (Rs. 500 crore in each bank)during the financial year 2015-16. Further the Company has subscribed to 260542050fully paid equity shares of NHPC Limited under Offer For Sale (OFS) at a cost of Rs. 21.78per equity share of Rs. 10/- each aggregating to Rs. 567.50 crore in April 2016.


REC has three lines of ODA credit with KfW Germany. All of them have been fully drawnas on March 31 2016. KfW-I and KfW-II ODA loan are of EUR 70 million each (approx. '454.02 crore & 480.97 crore respectively) and KfW-III is of EUR 100 million (approx.Rs. 753.73 crore). Apart from above REC has two line of ODA credit with JICA Japan. Bothof them have also been fully drawn. Under JICA-I & II ODA loans cumulative amounts ofJPY 16949.38 million (approx. Rs. 820.12 crore) and JPY 11809.48 million (approx. Rs.640.64 crore) respectively has been drawn as on March 31 2016.


Ministry of Power vide OM dated December 3 2014 conveyed sanction of the Presidentfor launch/implementation of Deendayal Upadhyaya Gram Jyoti Yojana (DDUGJY) an integratedscheme covering all aspects of rural power distribution. Under the scheme 60% of theproject cost (85% for special States) is provided as grant by Government of India andadditional grant upto15% (5% for special States) is provided by Government of India onachievement of prescribed milestones. All erstwhile RE schemes (including Rajiv GandhiGrameen Vidyutikaran Yojana) have been subsumed in DDUGJY. REC is the Nodal agency forimplementation of DDUGJY

Continuation of RE Scheme in XII and XIII five year plans was also approved by Ministryof Power with capital subsidy of : 35447 crore out of which ' 23397 crorewould be met through Gross Budgetary Support (GBS) for XII five year plan and remainingRS.12050 crore in XIII five year plan.

The main objectives of the scheme are to provide access to all rural households andreduction of AT&C losses as per trajectory (DISCOM-wise) finalized in consultationwith States by the Ministry of Power so as to achieve 24x7 power supply fornonagricultural consumers and adequate power supply for agricultural consumers through thefollowing project components:

i. Separation of agriculture and non-agriculture feeders facilitating improved qualitypower supply to non-agricultural consumers and adequate power supply to agriculturalconsumers in the rural areas;

ii. Strengthening and augmentation of sub-transmission & distributioninfrastructure in rural areas;

iii. Micro-grid and Off-grid distribution network;

iv. Metering of distribution transformers/feeders/consumers; and

v. Rural Electrification works (including the erstwhile RGGVY).

In this scheme earlier population criteria for eligibility of villages/hamlets havebeen removed and villages/ habitaions having less than 100 population is also eligible.

In order to realise the objectives of the scheme participation of all the stakeholdersparticularly public representatives has already been institutionalised throughconstitution of District Electricity Committees (DEC) under the Chairmanship of seniormost Member of Parliament. DEC is empowered to monitor and review the implementation ofDDUGJY.

9.1 UE Mission

At the time of independence only 3060 villages had electricity and hence there wascontinuous emphasis on village electrification. India's rural electrification programmepassed through several stages. Inspite of many programmes of Government of India as onApril 1 2015 18452 villages were still left for electrification which are mainlylocated in Odisha (3428) Assam (2892) Bihar (2747) Jharkhand (2581) ArunachalPradesh (1578) Meghalaya (912) etc.

On August 15 2015 Hon'ble Prime Minister announced that all remaining Un-Electrified(UE) villages would be electrified within 1000 days. The Ministry of Power has taken upthe electrification of all 18452 UE villages on Mission mode.

But these remaining 18452 UE Villages are located in highly inaccessible areas(thickly forested mountainous regions etc.) with tough terrain extreme temperaturesareas facing Right of Way (RoW) issues or areas plagued by insurgency and Leftwingextremism. Keeping in view these challenges and pace of electrification of villages duringlast few years it would have taken nearly 10 years to electrify the remaining villages.

REC had the experience of successfully constructing around 12000 toilets under SwachhBharat Abhiyan with the help of milestone-based micro-monitoring mechanism. Drawing ananalogy from this REC has developed an innovative monitoring mechanism which is blend oftechnology and right manpower at ground level.

A new monitoring mechanism was set up to get regular progress of each village. Underthis entire process of village electrification is divided into 12 milestones. Youngelectrical engineers: 'Gram Vidyut Abhiyanta (GVA)' were appointed at block/districtlevel. In order to shoulder this mission and accelerate its pace 'GARV APP' wellacknowledged for its transparent and accountable mechanism was designed and brought intodevelopment. The APP was launched by Hon'ble Power Minister on October 14 2015. The GARVAPP is designed in such a manner that it is able to delicately monitor and scrutinize theprogress of electrification statuses of all the 18452 Un-Electrified villages through anonline system.

The Salient features of GARV APP are Real-time dashboard Paper-less working Capturingvillage-wise milestones Uploading photographs/ Global Positioning System (GPS)Coordinates Timely highlighting of implementation hurdles if any Habitation- wiseinfrastructure Allows offline data entry Tracking of delay in implementation of worksSegregation of uninhabited villages State-wise snapshots Adoption ofvillages/districts/states & view their respective customized dashboard and alsofeedback and suggestions from use Rs.

Achievement so far:

The new monitoring mechanism helps for improving pace of village electrification. Thisresults during the year 2015-16 7108 villages were electrified and on August 11 2016the achievement has crossed 10000 UE villages.

9.2 Performance during financial year 2015-16

a. Sanctions

Under DDUGJY during the financial year 2015-16 for electrification through gridprojects for Rs. 31376.34 crore (Loan & Subsidy) in 25 States have been approved bythe Monitoring Committee of Ministry of Power.

In addition to above Decentralized Distributed Generation (DDG) projects have alsobeen sanctioned under DDUGJY for providing electricity access to the un-electrifiedvillages/habitations where grid connectivity is neither feasible nor cost-effective. DDGcan be from conventional or renewable sources such as biomass biofuels biogas minihydro solar etc. Subsidy of 60% (85 % for special category states) of the project costis provided under DDG scheme. However an additional subsidy of 15% (5 % for specialcategory states) is applicable subject to timely completion of DDG projects.

During the financial year 2015-16 for DDG (Off-grid) projects Rs. 869.30 crore havebeen sanctioned in 9 states. Also 232 projects have been commissioned in the states ofAndhra Pradesh Chhattisgarh Madhya Pradesh Kerala & Uttarakhand in the financialyear.

b. Fund releases

Under the scheme during the financial year 2015-16 a sum of Rs. 5023.99 crore (LoanRs. 419.01 crore & Subsidy Rs. 4604.98 crore) has been disbursed to the implementingagencies.

The subsidy from Government of India is channeled through REC and the balance amountcan be arranged by the State Government /Implementing Agency through Loan/Equity.

c. Progress of electrification

During the financial year 2015-16 under DDUGJY electrification works in 7108un-electrified villages and intensive electrification in 39236 villages have beencompleted. Also free electricity connections have been provided to 14.39 lakh BPLhouseholds.

The details of state-wise sanction fund released & progress of electrificationduring the financial year 2015-16 are given in enclosed Table-6.

9.3 Cumulative Performance upto March 31 2016

Under DDUGJY cumulatively up to March 31 2016 4466 projects for Rs. 107760.07crore have been sanctioned and against that Rs. 41061.48 crore (Loan & Subsidy) hasbeen disbursed to the implementing agencies.

As regards progress cumulatively upto March 31 2016 electrification works in116144 un-electrified villages and intensive electrification in 351233 villages havebeen completed. Also free electricity connections have been provided to 232.22 lakh BPLhouseholds.

The state-wise details of cumulative sanctions fund release & achievements aregiven in enclosed Table-7.


Your Company has continually provided technical expertise in the distribution system toState Power Utilities. The technical specifications and construction standards issued bythe Company are used extensively by the State Power Utilities. The Company in order topromote new technologies has been continuously looking for innovations using latestR&D in the field of power distribution.

In line with the three-tier Quality Control Mechanism for ensuring proper quality ofmaterials and works in implementation of RE component of DDUGJY XI & XII five yearplan schemes REC Quality Monitors (RQMs) under Tier-II have been appointed covering 413projects in 25 states under XI plan (Phase-I&II) and 273 projects in 15 states underXII Plan. Further during the financial year 2015-16 RQMs have undertaken inspections of286 villages in XI Plan Phase-I projects 950 villages & 75 Nos. of materialinspections in XI Plan Phase-II projects and 733 Nos. of material inspections were carriedout in XII Plan projects at manufacturer premises for ensuring quality of works. Alsoyour Company successfully accomplished the MoU target of Monitoring of Assetsfinanced/Collaterals and supervision of loans given to variousSEBs/DISCOMs/TRANSCOs/GENCOs and Private Companies for Single Project duringconstruction/before CoD having outflow more than Rs. 500 crore.


The Company has a Risk Management Policy which covers Asset Liability Management (ALM)Policy and Hedging Policy. ALM Policy provides a framework for defining measuring andmonitoring the mismatches and Hedging Policy covers the management of currency risk.

11.1 Asset Liability Management

The Company has constituted an Asset Liability Management Committee (ALCO) which isfunctioning under the chairmanship of CMD and comprises of Director (Finance) Director(Technical) Executive Directors and General Managers from Finance and Operating Divisionsas its membe Rs.

ALCO monitors risks related to liquidity interest rates and currency rates. Theliquidity risk is being monitored with the help of liquidity gap analysis and theCommittee manages the liquidity risk through a mix of strategies such as forward lookingresource raising programme based on projected disbursement and maturity profile. Theinterest rate risk is monitored through interest rate sensitivity analysis and monitoredthrough review of lending rates cost of borrowings and the reset terms of lending &borrowing. Foreign currency risk associated with exchange rate and interest rate ismonitored through various derivative instruments. In terms of MoU target the annualmismatch between Recoveries and Debt Servicing has been within limit and was 2% forfinancial year 2015-16.

11.2 Enterprise-Wide Integrated Risk Management

The Company is having a Risk Management Committee (RMC) which is functioning under thechairmanship of Part-time Non Official Independent Director and it comprises of Director(Finance) and Director (Technical) as its members for monitoring the integrated risks ofthe Company.

The main function of RMC is to monitor various risks likely to arise including theproject risk along with the categorization for the loan amount outstanding of Rs. 500crore & above and practices adopted by the Company and also to suggest action formitigation of risk arising in the operation and other related matters of the Company. TheCompany has identified its various risks and has taken various steps to mitigate them. Thebrief description of the risks is as below:

i) Credit Risk:

Credit risk is a risk inherent in the financing industry and involves the risk of lossarising from the diminution in credit quality of a borrower and the risk that the borrowerwill default on contractual repayments under a loan or an advance. To mitigate the samethe Company follows systematic institutional and project appraisal process to assess thecredit risk. These processes include a detailed appraisal methodology identification ofrisks and suitable structuring and credit risk mitigation measures.

ii) Market Risk:

Market risk is the potential loss arising from changes in market rates and marketprices. Our primary market risk exposures result primarily from fluctuations in interestrates and foreign currency exchange rates. In order to mitigate the interest rate riskCompany periodically reviews its lending rates based on prevailing market rates and ourweighted average cost of borrowing.

iii) Liquidity Risk:

Liquidity risk is the risk of potential inability to meet our liabilities as theybecome due. We face liquidity risks which could require us to raise funds or liquidateassets on unfavourable terms. We manage our liquidity risk through a mix of strategiesincluding through forward-looking resource mobilization based on projected disbursementsand maturing obligations.

iv) Foreign Currency Risk:

Foreign currency exchange risk involves exchange rate movements among currencies thatmay adversely impact the value of foreign currency-denominated assets liabilities andoff-balance sheet arrangements. The Company manages foreign currency risk associated withexchange rate and interest rate through various derivative instruments. For this theCompany has put in place a Hedging Policy to manage risk associated with foreign currencyborrowings.

v) Legal Risk:

Legal risk arises from the uncertainty of the enforceability of contracts relating tothe obligations of our borrowe Rs. This could be on account of delay in the process ofenforcement or difficulty in the applicability of the contractual obligations. We seek tominimise the legal risk through legal documentation and forward-looking contractualprovisions in the legal documents.

vi) Operational Risk:

The Company is facing operational risks arising out of RBI prudential norms NPAmanagement other regulatory measures compliances and Government policies affecting theproject financing in power sector. The Company is continuously following up with RBI &other regulatory agencies and consistently taking steps to strengthen its internal systemsand procedures to recognise and reduce operational risk in the business.


As a part of business promotion strategy a Preferred Customer Policy was formulated in2008 with the basic purpose of offering an enhanced level of services to the Company'scustomers and to have a long term mutually beneficial relationship with them.

The Policy lays down the eligibility criterion which takes into account various factorssuch as amount of loan outstanding duration of loan relationship repayment track recordof the borrower etc. for determining preferred customers and sponsoring them for capacitybuilding/domestic/international seminars/training programmes organized by various externalagencies as well as CIRE Hyderabad.


The Integrated ERP system is in operation in REC since 2009 covering major businessfunctions of Company which is being improved continuously by adding new features. Benefitsof ERP system has been extended to the borrowers also as a part of better service. Processfor Upgradation of ERP to newer version has been initiated.

Transformation of existing HR process into online IT driven HR process whereinemployees can initiate HR request online on internet through ERP based employeesself-service portal which is being operationalized in phased manner at all offices ofREC.

Towards achieving efficient e-governance and transparency in procurement now allprocurement of goods and services of value above Rs. 2 lakh is being done through thee-procurement system. The system is also capable of conducting e-Reverse Auction as perCVC guidelines. In addition REC has deployed a number of in-house developed systems viz.Annual Property Return Bill payment and tracking system Visitor Management System FileMovement System etc.

Both the Primary Data Centre (PDC) and Disaster Recovery Center (DRC) of REC areISO/IEC 27001:2013 Certified and comply to National Cyber Security Policy of Government ofIndia as notified by MeitY (Ministry of Electronics and Information Technology). Inaddition number of information security audits are conducted through CERT-in certifiedauditor internal auditor on a continuous basis.

REC has implemented Video Conferencing solution across all of its offices throughoutthe Country.

Corporate office of REC has become Wi-Fi enabled. This was one of the MoU target forthe financial year 2015-16 which has been successfully achieved on December 11 2015 i.e.within the target date. All field offices of the Company are also being made Wi-Fienabled. Also another MoU target of Implementation of HR-ERP Employee Self Service (ESS)Portal over Internet has been accomplished within the cut-off date.

IT Division is also promoting in the Company number of IT initiatives of Government ofIndia like MyGov e-Governance Digital India etc.

Computer to Employee population (other than Class-IV employees) is 100%. IT Divisionalso organizes and impart various training programmes.


CIRE was established at Hyderabad in 1979 under the aegis of REC to cater to thetraining and development needs of engineers and managers of Power Sector. The programmesare conducted on the state-of-art subjects of Power Generation Transmission Distributionand Renewable energy sources. On July 23 2015 CIRE was conferred with "EducationLeadership Award" by ABP News in recognition of 'Leadership Development Innovationand Industry Interface' of the Institute.

14.1 National Training Programmes (NTP) under DDUGJY

CIRE is designated as a nodal agency by Ministry of Power for implementation ofNational Training Programmes (NTP) for employees of C&D category under the HumanResources Development component of DDUGJY programme. A target of training 125000employees of C&D category was set to be achieved by CIRE during XII plan period. As onMarch 31 2016 CIRE was able to organize training of 98833 employees of C&D categoryof various power distribution utilities which includes 32013 employees of C&Dcategory trained during 2015-16. CIRE/REC has entered into MoAs with 37 Power Utilities/Training Institutes to conduct the above programmes. A 2-day workshop at CIRE Campus forNodal Officers of DISCOMs was also organized about the programmes.

CIRE on the request of power utilities has organized 55 Programmes for employees ofC&D category with 1365 participants at various locations and has also conducted 4Training of Trainers (ToT) programmes for 93 participants.

14.2 R-APDRP Programme

CIRE was empanelled as partner training institute to organize R-APDRP programmessponsored by Ministry of Power. During the year 2 Nos. Training-of-Trainers programmesunder R-APDRP on "Revenue Management & Loss Reduction" with 21 participantsfrom different power utilities were organized.

14.3 International Programmes

CIRE is empanelled by Ministry of External Affairs Government of India to organizetraining programmes in the area of power sector under Indian Technical & EconomicCooperation (ITEC)/ Special Commonwealth Assistance for Africa Programme (SCAAP). Duringthe year CIRE has organized 9 International programmes with 132 participants on varioustopics viz. Financial Management and Accounting System for Power Companies (8 weeks);Planning and Management of Power Transmission & Distribution Systems (8 weeks);Decentralized Distributed Generation & Rural Power Distribution Management (8 weeks);Design Erection Operation & Maintenance (O&M) of Extra High Voltage (EHV)Sub-Stations (4 weeks); Solar Power Generation - Grid Enabling (4 weeks); Best Practicesin Power Distribution (5 weeks); Management of Power Utilities using IT/AutomatedSolutions (5 weeks); Trends and Developments in Electric Power Generation (8 weeks) andCertificate Course in Electric Power Management (12 Weeks).

The participants from countries viz. Afghanistan Algeria Bangladesh BhutanBurundi Cambodia Cameroon Democratic Republic of the Congo Ecuador Egypt GambiaGhana Kenya Malawi Mauritius Myanmar Nepal Nigeria Niger Philippines RussiaSamoa Saint Lucia Sudan Syria Tanzania Thailand Zimbabwe etc. have attended theprogrammes.

14.4 Regular National Programmes

CIRE has organized 20 Regular Training Programmes for the personnel of various PowerUtilities/Distribution Companies on different topics such as Pilferage of Electricity -Issues Challenges and Remedial Measures; Ind AS (International Financial ReportingStandards) Adoption in Power Sector; Solar Photovoltaic System - Quality and Performance;Technical Specifications and Construction Standards for Distribution System; ProtectionSystem in EHV Sub-Stations; Power Trading & Exchange; Earthing Practices and SafetyMeasures in Electrical Installations; Open Access Power Trading and Availability BasedTariff; Gas Insulated and Indoor Sub-stations including Power & Control Cables;Testing Commissioning and Protection aspects in 33/11 KV Sub-stations; Power FactorImprovement and Reactive Power Management; Power Purchase Agreement; Tariff Policy &Submission of ARRs - Regulatory Compliance; Best Practices in O&M of EHV Sub-stationsand Lines; Efficiency Improvement Measures in Thermal Power Station; Technical Aspects forNon-Technical Executives; and Latest Trends in Metering Billing and Collection. A totalnumber of 243 participants attended the above programmes.

14.5 Programmes organised in collaboration

CIRE has organised training programmes in collaboration with premier ManagementInstitute i.e. Institute of Public Enterprise and conducted 5 programmes during thefinancial year 2015-16 viz. Best Practices in HR Management of Power Utilities;Procurement and Materials Management; Companies Act 2013 and HR for Line Managers with 45participants.

14.6 Customized Programmes

During the year 26 customized programmes were organized for different Power Utilitiesand out of these 19 programmes were organized for Andhra Pradesh Power Utilities such asAPTRANSCO APSPDCL and APEPDCL 6 programmes were organized for the executives of PunjabState Power Corporation Limited (PSPCL) on "Power Distribution Management" and 1induction programme of 6-week duration was organised for APSPDCL engineers at CIRE campus.In total 475 participants were trained under customized programmes.

14.7 In-house Training Programmes

CIRE has also organised 6 in-house programmes for the employees of REC and 53 Employeeshave taken part in these programmes. The topics covered are Procurement Guidelines;Communication & Negotiation Skills; General Management; Leadership & Teamwork; RECSpecifications & Construction Standards; and Finance for Non-finance.

14.8 In all during the year 2015-16 in addition to coordinating and monitoring theNational Training Programmes for employees of C&D category sponsored by Ministry ofPower CIRE has conducted 128 programmes on various themes and trained 2471 personnelwith 14353 mandays of training.


The Company has implemented Quality Management Systems as per ISO 9001:2008 standardsin six major Divisions of Corporate Office and all Zonal/Project Offices across thecountry for claims processing.


In order to professionalize the Executive strength of the Company and also to infusefresh blood 44 Executives were appointed through open advertisement and 8 Executives wereappointed through Campus Recruitment during the financial year. The total manpower of theCompany as on March 31 2016 was 600 employees which includes 463 Executives and 137Non-Executives.

16.1 Reservation in Employment

The directives issued by the Government of India regarding reservations for SC/ST appointment and promotion to various posts were complied with. The group wise detailsof SC and ST employees out of total strength as on March 31 2016 are given below:






FY 2015-16 FY 2014-15 FY 2015-16 FY 2014-15 FY 2015-16 FY 2014-15
A 391 359 40 33 14 12
B 99 121 13 17 2 2
C 36 42 6 7 0 0
D 74 79 22 24 1 1
Total 600 601 81 81 17 15

As on March 31 2016 14 employees out of total employees are in the category ofpersons with disabilities which amounts to 2.33% of total manpower of the Company.

16.2 Training & Human Resource Development

As a measure of capacity building including up-gradation of employees' skill sets andto ensure high delivery of performance Training and HRD continued to receive priorityduring the financial year. Training and Human Resource Policy of the Company aims andsharpening business skills and competence required for better employee performance andprovides all possible opportunities and support to the employees to improve theirperformance and productivity. Training was also provided to promote better understandingof professional requirements as well as to sensitize employees to socio-economicenvironment in which business of the Company is carried out. Training which helpedemployees benefit in spiritual health and attitudinal change process was also imparted.

In order to equip the employees professionally the Company sponsored 251 employees tovarious training programmes workshops etc. within the country and abroad. In addition 7training programmes were conducted in-house which were attended by around 151 employees.Taken together these initiatives enabled the Company to achieve 1096 training mandays andalso achieve the MoU target of 'Excellent' rating for this parameter. These includedexposure of executives to training programme on the subject of Team work and Leadershipand Exposure of Top & Senior Management Team to training on advanced managementprogrammes under which 105 mandays p and 109 mandays were achieved as against a MoU targetof 90 21 and 100 mandays respectively. 19 Executives were deputed for n programmes incountries like Japan U.K France & China.

16.3 Employee Welfare

In order to provide improved health care facilities to the employees and theirdependent family members the Company has expanded the list of empanelled hospitals underDirect Payment Scheme by adding 6 hospitals. Further part time services of 4 specializeddoctors were engaged to provide onsite medical facilities to employees. The Company hasalso been funding sports & recreation equipment for use by employees and to promotewell-being of employees.

Sports Activities

During the financial year 2015-16 REC hosted an Inter-CPSU Carrom Tournament and alsosponsored its employees for various Inter- CPSU sports tournaments such as BadmintonTable Tennis Volley Ball Kabbadi Chess etc. organized by various power sector CPSUsunder the aegis of Power Sports Control Board (PSCB). Further employees were encouragedto participate in various quiz paper presentations and simulation competitions conductedby reputed institutions.

16.4 Representation of Women Employees

As on March 31 2016 the Company had 97 permanent women employees which represent16.17% of the total work force. There is no discrimination of employees on the basis ofgender. A Women Cell has been in operation in the Company to look after welfare and allround development of women employees. International Women's Day was celebrated by RECWomen Cell and a health check-up camp was also organized exclusively for women employees.

16.5 Industrial Relations

The Industrial Relations scenario in the Company continued to be cordial and harmoniousin the financial year 2015-16. There was no loss of mandays on account of industrialunrest. Regular interactions were held with REC Employees Union and REC OfficersAssociation on issues of employee welfare. This has helped to build an atmosphere of trustand cooperation resulting in a motivated workforce and continued improvement in businessperformance.

16.6 Public Grievance Redressal Machinery

In accordance with the guidelines issued by the Government of India the Company hasconstituted a Grievance Redressal Committee to redress the grievances of employees.


The 'REC Corporate Social Responsibility & Sustainability Policy' prepared in linewith the provisions of Companies Act 2013 and Rules thereunder The Companies (CorporateSocial Responsibility Policy) Rules 2014 and Guidelines for CSR and Sustainability forCentral Public Sector Enterprises issued by Department of Public Enterprises Ministry ofHeavy Industries & Public Enterprises effective from April 1 2014 was approved bythe Board of Directors of the Company. The 'REC Corporate Social Responsibility &Sustainability Policy' is available on the website of the Company.

During the financial year 2015-16 the Corporate Social Responsibility and SustainableDevelopment (CSR & SD) initiatives of the Company were continued with a view tointegrate REC's business operations with social processes while recognizing the interestsof its stakeholde Rs. CSR & SD projects were linked with the principle of sustainabledevelopment. The strategic focus was aimed at CSR & SD initiative towards fulfillingthe National Plan goals and objectives including Millennium Development Goals ensuringgender sensitivity skill enhancement entrepreneurship and employment generation byco-creating value with local institutions/ people. While identifying such initiatives theCompany has adopted an integrated approach to address the community societal andenvironmental concerns measured in terms of triple bottom line approach. During the yearthe Company has undertaken various CSR initiatives in the fields of skill developmentprogrammes education environmental sustainability promotion of health care includingfor old age and persons with disabilities drinking water and sanitation facilitiesincluding participation in Swachh Vidyalaya Abhiyan solar smart micro grid lights inselect un-electrified/ poorly electrified villages etc. The CSR strategy has beendeveloped with action plan in project-based accountability approach. Most of the CSRactivities have been implemented in project-mode with baseline survey specifiedtime-frame identified milestones and periodic monitoring and impact assessment.Disbursement of allocated funds under CSR was linked with achievement of the milestonesand deliverables. During the financial year 2015-16 financial assistance aggregating toRs. 163.17 crore was sanctioned for various projects under Corporate Social Responsibilityand expenditure of : 128.20 crore was incurred including amount provided.

In terms of the Companies (Corporate Social Responsibility Policy) Rules 2014 theAnnual Report on CSR activities is annexed to this Report.


Vigilance Division constantly endeavored to optimize probity and integrity and promoteprofessionalism ethical work culture and discipline among the employees. The emphasis ofVigilance Division was primarily on streamlining the systems and policies and inculcatingtransparency and accountability in the work processes.

Vigilance Division constantly tried to identify vulnerable areas in the systems andprocedures to reduce the scope of arbitrariness and discretion in decision making to theextent possible. The Division regularly pursued with all concerned to ensure that CVC'sinstructions were strictly implemented in the Company. Pursuant to vigilance initiativeIntegrity Pact File Movement System Bill Tracking System and Security System inCorporate Office premises were implemented/ operationalised. Also a training programme forthe newly recruited officers in REC with respect to REC CDA Rules Tendering proceduree-procurement etc. was organized. REC Procurement Guidelines encompassing all relevantinstructions issued by CVC/Ministry of Power etc. have been revised.

Almost all tenders above Rs. 5 lakh were processed through e-Procurement mode w.e.f.April 1 2015. All concerned divisions were advised to comply with the instructions of CVCwith respect to award of contract on single tender/nomination basis. The guidelines forcompliance of password policy for accessing ERP/E-mail/Software applications wereformulated and uploaded on REC Intranet.

Regular review meetings were taken up by Vigilance Division with operating divisions onthe existing systems and procedures to make these more transparent and accountable.Scrutiny of tendering procedure was carried out randomly and suggestions were given tofurther improve/streamline the tendering mechanism.

REC observed Vigilance Awareness Week (VAW) from October 26 2015 to October 31 2015.At Corporate office Quiz Competition and Lectures were organized. Lectures on EthicsTransparency and Integrity were also organized in three colleges of Delhi University andElocution Competition was held in two schools in Delhi. A hand book on 'REC Code ofEthics' was brought out covering important aspects of integrity probity work cultureemployee's competencies ethical behavior etc. Various activities viz. essaywriting/debate competition and public awareness rallies etc. were also organized inZonal/ Project Offices of REC and CIRE Hyderabad.

Regular/surprise inspections were carried out by officers of Vigilance Division infield offices and employees were sensitized about the importance of Vigilance. AuditReports were scrutinized from a vigilance point of view.

With a view to enhance the knowledge of employees on vigilance related issues aVigilance Bulletin was issued periodically. The details of Immovable Property Returns(IPRs) of all Executives have been uploaded on REC's Website and vigilance clearance hasbeen linked with timely submissions of IP Rs. Annual Property Returns of the employeeswere subject to systematic scrutiny. The performance of Vigilance Division was reviewedperiodically by the CVC Board of Directors and CMD in addition to regular reviewsundertaken by the CVO in accordance with the prescribed norms.


The Company has been implementing the provisions of Official Language Policy of theDepartment of Official Language Government of India. The quarterly meetings of OfficialLanguage Implementation Committee (OLIC) were held regularly to review the progressive useof Hindi in the Company under the chairmanship of CMD. To review and encourage employeesto use Hindi and implementation of Annual Programme 2015-16 was the primary concern ofthese meetings.

The Parliamentary Committee on Official Language held the inspections of REC Projectoffice Hyderabad on April 9 2015 and REC Corporate office on January 21 2016. Officialsfrom Department of Official Language under Ministry of Home Affairs conducted theinspection of the Corporate Office. Further Internal Inspections were carried out toassess the progressive use of Hindi in 9 divisions of Corporate Office and its 6 ProjectOffices.

Nodal Hindi Officers were nominated in all Zonal/Project offices of REC to ensureproper implementation of Official Language policy.

A Hindi Pakhwara was organized from September 14 - 28 2015 in the Company in which 9competitions were organized for the employees. 47 employees won prizes in differentcategories in these competitions.

During the financial year 2015-16 four Hindi Practice based workshops were organisedat the Corporate office in which 125 Executives/Non-Executives participated. Further aZonal Hindi Workshop was also organized on August 19-20 2015 at REC Zonal OfficeBangluru for the employees of REC 'C' region in which 19 employees including Nodal HindiOfficers of the respected offices were trained.

The Company has also been awarded "Rajbhasha Gaurav Samman" by RashtrabhashaSwabhiman Nyas for its concerted efforts made in implementation of official languagepolicy.

To create a conducive atmosphere for working in Hindi and to facilitate original workin Hindi books such as English-Hindi Hindi-English dictionaries help andreference-Literature technical glossaries are widely publicized. Besides fifty per-centof the expenditure earmarked for purchase of books has been utilized for purchase ofbooks published in Hindi.


20.1 Conservation of Energy

The Registered Office of the Company is located at 'SCOPE Complex' where all civilelectrical installation & maintenance is carried out by SCOPE. Due to effectivemonitoring controlling & scheduling the operation of Chilling units Elevators &by putting energy efficient equipment replacement of conventional light fittings CFLetc. with LED light fittings and maintain power factor to nearest to unity SCOPE hassaved around 5.24 Lakh Units consumption resulting in saving of Rs. 57 Lakh in terms ofamounts during the financial year 2015-16.

Further as a result of replacement of conventional light fittings with energyefficient LED lights in Corporate Office at SCOPE Complex REC has saved around 82135units of electricity resulting in saving of Rs. 680186/- during the year.

20.2 Foreign Exchange Earnings & Outgo

No foreign exchange was earned during the financial year 2015-16. However the foreignexchange outflow aggregating to Rs. 661.03 crore was made during the financial year onaccount of interest finance charges and other expenses.


Your Company has two Wholly Owned Subsidiaries (WOS) to focus on additional businessof consultancy in the areas of distribution transmission etc.:

(i) REC Power Distribution Company Limited (RECPDCL) (CIN: U40101DL2007GOI165779)

(ii) REC Transmission Projects Company Limited (RECTPCL) (CIN: U40101DL2007GOI157558)

Further Ministry of Power Government of India allocates independent transmissionprojects from time to time to RECTPCL to work as Bid Process Coordinator (BPC)forselection of developer as Transmission Service Provider (TSP) through Tariff BasedCompetitive Bidding Process.In order to initiate development of each independentinter-state transmission project allocated by Ministry of Power Government of IndiaRECTPCL incorporates a project specific Special Purpose Vehicle (SPV) as Wholly OwnedSubsidiary Company and after the selection of successful bidder through Tariff BasedCompetitive Bidding Process notified for transmission projects the respective projectspecific SPV along with all its assets and liabilities is transferred to the successfulbidder. As on March 31 2016 following project specific Special Purpose Vehicles (SPVs)existed as Wholly Owned Subsidiary Companies of RECTPCL:

1. Nellore Transmission Limited (NTL) (CIN: U40104DL2012GOI245654)*

2. Baira Siul Sarna Transmission Limited (BSSTL) (CIN: U40106DL2013GOI247564)*

3. NRSS XXXVI Transmission Limited (CIN: U40300DL2015GOI284168)

4. North Karanpura Transco Limited (NKTL) (CIN: U40103DL2015GOI287880)

5. Khargone Transmission Limited (KTL)(CIN: U40300DL2015GOI287933)

6. Dinchang Transmission Limited (DTL)(CIN: U40300DL2015GOI288066)

7. NER II Transmission Limited (NTL) (CIN: U40106DL2015GOI279300)

* Office of Registrar of Companies (RoC) NCT of Delhi and Haryana has approved theapplications for striking off the name of Nellore Transmission Limited and Baira SiulSarna Transmission Limited from the Register of Companies u/s 560 of Companies Act 1956and both the companies have been dissolved. Further RoC has issued certificate dated May25 2016 for Nellore Transmission Limited and certificate dated July 16 2016 for BairaSiul Sarna Transmission Limited in respect of dissolution.

Further Transmission System for LTA of 400MW for 2x500MW Neyveli Lignite CorporationLimited. TS-I (Replacement) (NNTPS) in Neyveli which was notified vide GazetteNotification dated July 9 2014 has been denotified vide Gazette Notification dated July24 2015 considering the small size of project.

21.1 REC Power Distribution Company Limited

During the financial year 2015-16 RECPDCL has not only excelled in its core businessviz. Preparation of Detailed Project Reports (DPR's) Third Party Inspections (TPI)Material Inspection & Project Management Consultancy (PMC) services but also set itsquality benchmark in the area of Project Implementation under R-APDRP Part-A and executionof turnkey works relating to the construction of toilets (using conventional and prefabtechnologies) in schools across India under CSR initiatives of REC under Swachh VidyalayaAbhiyan. Work executed by RECPDCL has been widely appreciated at various platforms ingeneral and our valued customers in particular.

The major assignments undertaken during the financial year 2015-16 are as follows:-

1) IT Implementation works under R-APDRP Part-A for Goa Electricity Department

RECPDCL has excelled in IT Implementation Works under R-APDRP Part-A for GoaElectricity Department (GED) and has set a benchmark of roll-out of Pilot town within ashortest record period of one year.

RECPDCL has procured various hardware/software/services e.g. Servers Storagesubsystem UPS Desktops Printers DGPS survey GIS software Network Analysis Moduleetc. after following due e-tendering process and reverse auction to maintain bettertransparency and higher quality standard.

The work executed till March 312016 includes Preparation of Base-line Data System forthe project area covering Consumer Indexing (in Panjim & Marmagoan town) GIS Mappinginstallation of Automatic Meter Reading (AMR) on Distribution Transformers and Feedersset-up of Data centre & Data Recovery Centre with all IT equipments viz. ServersStorage Critical UPS etc. set-up of IT equipments at Sub-Divisional Offices & OtherOffices of Panjim Mapusa & Marmagaon town.

2) Preparation of Detailed Project Report and working as Project Monitoring Agencyunder DDUGJY and IPDS

RECPDCL is engaged in preparation of Detailed Project Report (DPR) and ProjectManagement Agency (PMA) under DDUGJY and IPDS schemes for various DISCOMs namely:

Paschimanchal Vidyut Vitaran Nigam Limited (PVVNL); Dakshinanchal Vidyut Vitaran NigamLimited (DVVNL); Madhya Pradesh Madhya Kshetra Vidyut Vitaran Company Limited (MPmKvVCL);West Bengal State Electricity Distribution Company Limited (WBSEDCL); Assam PowerDistribution Company Limited (APDCL); Manipur State Power Distribution Company Limited(MSPDCL); Chhattisgarh State Power Distribution Company Limited (CSPDCL); BangaloreElectric Supply Company Limited (BESCL); Hubli Electric Supply Company Limited (HESCL);Chamundeshwari Electricity Supply Company Limited (CESCOM); Gulbarga Electricity SupplyCompany Limited (GESCOM); Mangalore Electricity Supply Company Limited (MESCL); & TheHukkeri Rural Electric Co-operative Society Limited (HRECS).

3) New Initiatives & Assignment ahead

RECPDCL is looking forward to get more diversified business opportunities. Theopportunities under consideration are as follows:

a. The process of Empanelment of different agencies to carry out LED based lightingEnergy Efficiency projects and Solar PV (Off Grid/Grid connected) projects etc. across thecountry is under progress.

b. Project Management Consultancy (PMC) under DDUGJY for J&K ElectricityDepartment.

c. Future business endeavours: RECPDCL is planning & focusing in various new highend technologies consultancy and implementation business viz. Smart Grid and Mini Gridimplementation etc.

Besides achieving the excellent performance in the conventional areas of business sinceits incorporation in the year 2007 during the financial year 2015-16 RECPDCL has alsobeen successful in getting business in other segments like - (i) Renewable Energy (SolarProjects) in Assam; (ii) Energy Efficiency Projects; and (iii) Monitoring the progress ofwork of electrification of un-electrified villages.

(i) Renewable Energy /SPV Project

To promote the utilization of renewable energy to save environment RECPDCL hasparticipated actively in Roof Top Solar projects. The Company has already completed surveyand DPR preparation for 145 remote villages in jurisdiction of Assam Power DistributionCompany Limited (APDCL) in Assam State.

(ii) Odisha Solar Project

Contract Award was placed on M/s Punam Energy Private Limited Kolkata. Survey of allawarded 16 schools was completed. Contractor has submitted Drawings Time schedule PlanBill of material. Ordering of all solar items & equipment for 16 project sites is inprocess.

(iii) Fund Management

RECPDCL has expanded its portfolio of services further and has added a new businessvertical of Fund Management to its existing segments. RECPDCL is currently working as theLead implementing agency for managing Bureau of Energy Efficiency's (BEE) Partial RiskGuarantee Fund for Energy Efficiency. The agreement has been signed with BEE on July 162015.

Further with increasing presence of RECPDCL in the field of Energy Efficiency it isalso now empanelled with BEE as an Energy Service Company (ESCO) with a vision to furtheractively participate in the Energy efficiency market.

(iv) Monitoring of Electrification of Un-Electrified Villages (UEV)

Ministry of Power (MoP) has decided to take electrification of all 18452Un-Electrified (UE) villages on Mission Mode and set target of electrification ofUn-electrified villages by March 2017. MoP has appointed REC as Nodal Agency to monitorthe progress of electrification work of UE villages and further REC has awarded the workrelating to day to day monitoring website maintenance & updation to develop REmobile application (GARV App) control room-setup call center and quality surveillancechecks during electrification of UE villages etc. to its Wholly Owned Subsidiary Companyi.e. RECPDCL.

For monitoring the progress of electrification work of UE villages in an effective andspeedy manner RECPDCL has deputed 415 engineers in field as "Gram VidyutAbhiyantas" (GVAs) at Blocks/Districts level in different state across the countryand 75 engineers as "District Vidyut Abhiyantas" (DVAs) posted in all districtsof Uttar Pradesh to look after progress of work in their respective districts. RECPDCL hasalso developed a Web-Portal and a Mobile Application viz. "GrameenVidyutikaran-GARV" to closely monitor the real time progress of electrification workof UE villages.

Tablets with latest and upgraded technology have been provided to all the GVAs tocomplete the assignment efficiently & in a time bound manner as well as to capture thereal time Pictures & Videos in the GARV app so that the progress can be monitored byeveryone across the country.

The captured pictures and videos by GVAs are being published in the GARV App aftergoing through a multi-stage scrutiny & approval at Project Office and Head Officelevel. The village is being declared electrified on GARV App only when it is declaredelectrified by DISCOMs and further checked & found electrified by GVAs.

During the financial year 2015-16 REC has achieved the target of electrification of7108 UE villages against the internal target of electrification of 7000 UE villages.Further as on August 11 2016 10006 villages have been electrified. The brief detailsare mentioned below:

Sl. No. Total UE Villages Electrified Uninhabited To be Electrified Total Village Visited Total Visits by GVAs
1 18452 10006 525 7921 16597 46401

Swachh Vidyalaya Abhiyan (SVA)

REC Power Distribution Company Limited (RECPDCL) (Wholly-Owned Subsidiary of REC) wasappointed as Project Implementing & Monitoring Agency for monitoring of work relatingto construction of 7096 Nos. of toilets in schools in 26 districts of Bihar RajasthanMadhya Pradesh Uttar Pradesh Telangana and Punjab states under 'Swachh VidyalayaAbhiyan' (SVA) in response to Prime Minister's call to the nation. All the toilets wereconstructed & successfully handed over to the respective school authorities within thestipulated time period. The estimated construction cost of 7096 Nos. of toilets is aroundRs. 110 crore.

SKOCH Smart Technology Award 2015

In recognition of its excellent work done for achieving the target of construction oftoilets under 'Swachh Vidyalaya Abhiyan' (SVA) RECPDCL has received appreciation fromMinistry of Power (MoP) and also was conferred with the 'SKOCH Smart Technology Award2015' for the Swachh Vidalaya Swachh Bharat& UE Mission at the SKOCH Smart TechnologyAward 2015 Ceremony held on December 11 2015 at New Delhi. Due to the excellent workcarried out by RECPDCL even in some of the most disturbed areas RECPDCL has been furtherawarded the work for construction of toilets in Gazipur district of the State of UttarPradesh.

Information Technology Initiatives

As an Information Technology initiative an internal portal has been created for onlinestorage of the data/reports related to the Swachh Vidyalaya Abhiyan project and monitoringof milestone wise payment to the contractors against the construction of toilets indifferent states. RECPDCL has also implemented the backup policy for maintaining theregular back up of important data to various storage disks at different locations in orderto minimize the risks.

OHSAS 18001:2007 Certification

Apart from ISO 9001:2008 and ISO 14001:2004 RECPDCL has also been conferred with OHSAS18001:2007 during the financial year 2015-16 for implementation of Occupational Health andSafety Assessment System for carrying out administrative and other allied activities atCorporate Office Delhi.


The performance of RECPDCL in terms of MoU signed with the holding company i.e. RuralElectrification Corporation Limited for the financial year 2013-14 had been rated as"Excellent" by the Department of Public Enterprises (DPE) Government of India.For the financial year 2014-15 and 2015-16 also the Company is poised to receive"Excellent" rating.

Financial Performance of RECPDCL

The Financial Performance of the company is on the fast trajectory growth path. Duringthe financial year 2015-16 the company's total revenue has increased by 73% to Rs. 151.54crore as compared to Rs. 87.79 crore in the previous year. The Profit Before Tax (PBT) hasincreased by 6% to Rs. 55.44 crore as compared to 52.52 crore in the previous year.Further the Profit After Tax (PAT) has also increased by 4% to Rs. 36.17 crore from Rs.34.77 crore during the previous year. The Board of Directors of RECPDCL has recommended adividend of : 2170.56 (Rupees Two Thousand One Hundred Seventy and Fifty SixPaisa) per equity share (on the face value of Rs. 10/- each) representing 21705.60% ofthe Paid up Share Capital of the Company for the financial year 2015-16 subject to theapproval of Shareholders of the company in the 9th Annual General Meeting asagainst Rs. 100/- (Rupees One Hundred) per share representing 1000% of the Paid up ShareCapital of the Company in the previous year. The total dividend pay-out for the financialyear 2015-16 will amount to Rs. 10.85 crore (excluding dividend distribution tax).

21.2 REC Transmission Projects Company Limited (RECTPCL)

During the financial year 2015-16 the Ministry of Power Government of India videGazette Notification dated July 24 2015 and November 17 2015 has allocated followingfive inter-State transmission systems with aggregate estimated cost of Rs. 4700 crore toRECTPCL to act as the Bid Process Coordinator for selection of developer for:

I. System Strengthening Scheme in Northern Region (NRSS-XXXVI) along with LILO ofSikar-Neemrana 400kV D/C Line at Babai (RRVPNL).

II. Immediate evacuation for North Karanpura (3x660 MW) generation project of NTPC andCreation of 400/220 kV Sub-station at Dhanbad -Proposal of JUSNL (ERSS-XIX).

III. Transmission system Strengthening in WR associated with Khargone TPP (1320 MW).

IV. Transmission system for Phase-I Generation Projects in Arunachal Pradesh.

V. NER System Strengthening Scheme-II (Part- B) & V.

Further for each of the transmission project a two stage Bidding process featuringseparate Request for Qualification (RfQ) and Request for Proposal (RfP) is adopted inaccordance with Tariff Based Competitive Bidding guidelines of Ministry of PowerGovernment of India for selection of developer as Transmission Service Provider. After theselection of successful bidder the respective project specific SPV along with all itsassets and liabilities is transferred to the successful bidder.

For the transmission projects listed at Sl. No. I to IV above RECTPCL incorporatedproject specific SPVs by the name of NRSS XXXVI Transmission Limited on August 182015North Karanpura Transco Limited on November 27 2015 Khargone Transmission Limitedon November 28 2015 and Dinchang Transmission Limited on December 2 2015.

For transmission project listed at Sl. No. V CEA had initially notified RECTPCL to bethe Bid Process Coordinator for "NER System Strengthening Scheme II" videgazette notification dated February 9 2015. Accordingly SPV was incorporated by the nameof NER II Transmission Limited on April 21 2015. Subsequently Empowered Committee in itsmeeting held on September 14 2015 revised the scope of project and proposed to merge withanother transmission project and named the scheme as NER System StrengtheningScheme-II(Part-B) & V. The revised scheme has also been allocated by the Ministry ofPower Government of India vide Gazette Notification dated November 17 2015.

The bidding process of following transmission projects has been completed and therespective project specific SPV has been transferred to the successful bidder (from April2015) as detailed below:-

Sl. No. Name of Transmission Project Name of Project Specific SPV Name of Selected Bidder Date of Transfer of project specific SPV
1 Transmission System Associated with Gadarwara STPS (2 RS.800 MW) of NTPC (Part-A) Gadarwara (A) Transco Limited M/s Power Grid Corporation of India Limited April 242015
2 Transmission System Associated with Gadarwara STPS (2 RS.800 MW) of NTPC (Part-B) Gadarwara (B) Transmission Limited M/s Power Grid Corporation of India Limited April 242015
3 Connectivity Lines for Maheshwaram (Hyderabad) 765/400 kV Pooling S/s Maheshwaram Transmission Limited M/s Sterlite Grid 3 Limited August 202015
4 Strengthening of Transmission System beyond Vemagiri Vemagiri II Transmission Limited M/s Power Grid Corporation of India Limited December 42015
5 Transmission System Strengthening in Indian System for transfer of power from new HEPs in Bhutan Alipurduar Transmission Limited M/s Kalpataru Power Transmission Limited January 6 2016
6 Immediate evacuation for North Karanpura (3x660 MW) generation project of NTPC and Creation of 400/220 kV Sub-station at Dhanbad -Proposal of JUSNL (ERSS-XIX) North Karanpura Transco Limited M/s Adani Transmission Limited July 8 2016

During the current financial year RECTPCL has been engaged to prepare Detailed ProjectReport and to act as Project Management Agency (PMA)in respect of Integrated PowerDevelopment Scheme by Kanpur Electricity Supply Company Limited (KESCO).

During the financial year ended March 31 2016 RECTPCL has generated an income ofRS.44.15 crore. The Profit Before Ta Rs.and Profit After Tax for the year is f 42.42 croreand Rs. 28.80 crore respectively. The Net Worth of RECTPCL is 123.41 crore against initialCapital injected by REC of Rs. 0.05 crore in year 2007. For the financial year 2015-16the Board of Directors of RECTPCL has recommended a dividend of Rs. 1730 per equity shareof face value of Rs. 10/-each i.e. 17300% on the paid up share capital of the companyamounting to Rs. 8.65 crore subject to approval of shareholders of the Company in theAnnual General Meeting.


REC along with three other PSUs namely Power Grid Corporation of India Limited NTPCand PFC as partners has formed a Joint Venture Company by the name Energy EfficiencyServices Limited (EESL) on December 10 2009. The Company has contributed Rs. 47.50 crore(being 28.8% of paid-up capital of EESL) upto March 31 2016. Further during thefinancial year 2016-17 the Equity investment of REC in EESL was increased to 146500000Equity Shares of Rs. 10/- each w.e.f April 25 2016. Accordingly as on date REC holds31.7% of the paid up equity share capital of EESL.

EESL is formed to create & sustain market access of energy efficient technologiesparticularly in the public facilities like municipalities buildings agricultureindustry etc. and to implement several schemes of Bureau of Energy Efficiency Ministry ofPower Government of India. EESL is also leading the market related activities of theNational Mission for Enhanced Energy Efficiency (NMEEE) one of the 8 national missionsunder National Action Plan on Climate Change. The Business verticals of the companyinter-alia include implementing projects in Energy Service Company (ESCO) mode inAgriculture Demand Side Management (AgDSM) Municipal Demand Side Management (MuDSM)Distribution Energy Efficiency projects Building Small & Medium Enterprises (SMEs)Perform Achieve and Trade-Joint Implementation Plan (PAT-JIP) Corporate SocialResponsibility activities etc.

Currently EESL is implementing Municipal Street Lighting projects with variousMunicipal Corporation and AgDSM projects for replacement of inefficient Agricultural Pumpsets in agriculture sector Unnat Jyoti by Affordable LEDs for all formely DomesticEfficient Lighting Programme (DELP) in domestic residential sector in ESCO mode withvarious Utilities and CSR projects of various companies.

The performance of EESL during the year has improved and the financial performance ofthe company is on the growth path. During the financial year 2015-16 based on theunaudited financials the company's total revenue is Rs. 714.40 crore compared to theprevious year revenue of Rs. 71.11 crore. The Profit Before Tax (PBT) is Rs. 49.60 croreas compared to Rs. 13.57 crore in the previous year. Further the Profit After Tax (PAT)has also increased to Rs. 32.89 crore from Rs. 9.06 crore during the previous year.


Pursuant to Section 129 of the Companies Act 2013 and Accounting Standard-21 theCompany has prepared Consolidated Financial Statements including that of its SubsidiaryCompanies i.e RECTPCL & RECPDCL and Joint Venture Company i.e EESL which shall belaid before the ensuing 47th Annual General Meeting along with the StandaloneFinancial Statements of the Company. However those wholly owned subsidiary companieswhich are incorporated by RECTPCL & are subsidiary of REC in terms of provisions ofSection 2(87) of Companies Act 2013 for the purpose of subsequent disposal have not beenconsolidated in the financial statements of the Company.

Pursuant to sub-section (3) of Section 129 of the Act a statement containing thesalient features of the financial statements of subsidiaries and joint venture in FormAOC-1 forms part of this Annual Report.

The Audited Financial Statements including the consolidated financial statements andaudited accounts of subsidiaries of the Company are available on the website of theCompany at . Further these documents will be kept for inspection by anymember or trustee of the holder of any debentures at the Registered Office of the Company.The Company will also make available copy thereof upon specific request by any member ofthe Company interested in obtaining the same.


Being a Government Company the power of appointment of Directors on the Board of theCompany is vested with the President of India acting through the Ministry of Power (MoP)Government of India. The remuneration of Directors and employees of the Company is fixedas per extant Guidelines issued by Department of Public Enterprises (DPE) from time totime. Further the Part Time Non Official Independent Directors are paid sitting fees asdecided by the Board of Directors from time to time (within the limits prescribed underthe Companies Act 2013) for attending Board and Committee meetings. As per the norms ofGovernment of India the Government Nominee Director is not entitled to receive anyremuneration/ sitting fee from the Company. The details of remuneration/sitting fees paidto Directors are given in Corporate Governance Report annexed to this report.

Further Ministry of Corporate Affairs (MCA) vide Notification dated June 5 2015 hasexempted Government Companies from the requirements related to criteria formulation fordetermining qualifications positive attributes and independence of Directors and policyrelating to remuneration of Directo Rs.

As per the provisions of the Companies Act 2013 the Board of Directors of the Companyhas designated the Chairman and Managing Director (CMD) Director (Finance) Director(Technical) and Company Secretary as Key Managerial Personnel (KMPs) of the Company. Therole of CEO is being performed by the CMD and the role of CFO is being performed byDirector (Finance) of the Company.

During the financial year 2015-16 Dr. Arun Kumar Verma (DIN: 02190047) was appointedas Government Nominee Director vice Shri Badri Narain Sharma vide MoP Order dated October6 2015. Since Dr. Verma is a Director nominated by Central Government by virtue of itsshareholding in the Company approval of shareholders in the AGM for his appointment asDirector is not required in line with the provisions of Section 161 (3) of the CompaniesAct 2013.

Consequent to the resignation by Shri Prakash Thakkar (DIN: 01120152) he ceased to bea Director on the Board of the Company w.e.f October 12 2015 and MoP vide its order datedOctober 16 2015 has appointed Shri Sanjeev Kumar Gupta (DIN: 03464342) as Director(Technical) for a period of five years from the date of assumption of charge i.e. October16 2015 or till superannuation or until further orders whichever is earlier. Also MoPvide Order dated November 13 2015 has appointed three Part time NonOfficial IndependentDirectors namely Shri Arun Singh (DIN: 00891728) Shri Aravamudan Krishna Kumar (DIN:00871792) and Prof. T.T. Ram Mohan (DIN: 00008651) on the Board of Directors of theCompany for a period of 3 years from the date of notification of their appointment or tillfurther orders whichever is earlier. Further Director (Technical) and the IndependentDirectors are proposed to be appointed by the shareholders of the Company in the ensuingAGM.

As per the provisions of the Companies Act 2013 and in terms of provisions of Article82 (4) of Articles of Association of the Company Shri Ajeet Kumar Agarwal (DIN:02231613) shall retire by rotation at the 47th Annual General Meeting andbeing eligible offers himself for re-appointment. The Board of Directors recommends hisreappointment as a Director till the completion of his present tenure or until furtherorders whichever is earlier.

The brief resume of Directors proposed for appointment/re-appointment is annexed to theNotice of the AGM.


As per the statutory provisions a listed company is required to disclose in it'sBoard's Report a statement indicating the manner in which formal annual evaluation hasbeen made by the Board of its own performance that of its Committees and individualdirectors and the criteria for performance evaluation of Independent Directors as laiddown by Nomination and Remuneration Committee is also required to be disclosed in theAnnual Report.

However Ministry of Corporate Affairs vide its notification dated June 5 2015 hasexempted certain provisions of Companies Act 2013 for Government Companies. As per theabove notification the Nomination & Remuneration Committee is not required toformulate the criteria for appointment of Directors their remuneration policy andcarrying out their performance evaluation in certain cases. Further the Board ofGovernment Companies is not required to evaluate performance of directors in case they areevaluated by administrative ministry.

REC being a government company the evaluation of performance of all the members of theBoard including Independent Directors is undertaken by administrative ministry i.e.Ministry of Power Government of India.


The performance of your Company in terms of MoU signed with the Ministry of PowerGovernment of India for the financial year 2014-15 has been rated as"Excellent". This is the 22nd year in succession that REC hasreceived "Excellent" rating since the year 1993-94 when the first MoU was signedwith the Government. For the financial year 2015-16 also the Company is poised to receive"Excellent" rating. During the year your Company received "Fastest GrowingNavratna PSU' award from India Today and CMD of your Company also received "Best CEOAward" in the category of Best CEO Award instituted by Business Today.


The details of the composition terms of reference and number of meetings of the Boardand its Committees held during the financial year 2015-16 are provided in the CorporateGovernance Report annexed to this Report.


With reference to Section 134(5) of the Companies Act 2013 it is confirmed that:

(i) in the preparation of the annual accounts for the year ended March 31 2016 theapplicable Accounting Standards have been followed and no material departures have beenmade from the same;

(ii) such accounting policies have been selected and applied consistently (except forchanges in Accounting Policies as disclosed in the Notes to Accounts to the FinancialStatements) and judgments and estimates made that are reasonable and prudent so as to givea true and fair view of the state of affairs of the Company at the end of the financialyear and of the profit of the Company for that period;

(iii) proper and sufficient care is taken for the maintenance of adequate accountingrecords in accordance with the provisions of the Companies Act 2013 for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;

(iv) the annual accounts have been prepared on a going concern basis;

(v) Internal financial controls have been laid to be followed by the Company and suchinternal financial controls were adequate and operating effectively; and

(vi) the directors had devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.


The Companies Act 2013 permits companies to send documents like Notice of AnnualGeneral Meeting Annual Report and other documents through electronic means to its membersat their registered email addresses besides sending the same in physical form.

As a responsible Corporate Citizen the Company has actively supported theimplementation of 'Green Initiative' of Ministry of Corporate Affairs (MCA) and effectedelectronic delivery of Notices and Annual Reports since 2010-11 to those shareholderswhose email ids were already registered with the respective Depository Participants (DPs)and who have not opted for receiving such documents in physical form. The intimation ofdividends (interim/final) is also being sent electronically to those shareholders whoseemail ids are registered.

Members who have not registered their e-mail addresses so far are requested toregister their e-mail address with the Registrar and Share Transfer Agent (R&TA) ofthe Company/Depository Participant (DP) of respective member and take part in the GreenInitiative of the Company for receiving electronic communications and support the"THINK GREEN GO GREEN" initiative.

It is reiterated that upon receipt of requisition from the member including the memberswho have exercised the option of electronic delivery of these documents every member ofthe Company is entitled to receive free of cost a copy of the Balance Sheet of theCompany and all other documents required by law to be attached thereto including theStatement of Profit and Loss and Auditors' Report etc.

Further pursuant to Section 108 of the Companies Act 2013 read with Rule 20 of theCompanies (Management and Administration) Rules 2014 the Company is providing e-votingfacility to all members to enable them to cast their votes electronically in respect ofresolutions set forth in the Notice of Annual General Meeting (AGM). The detailedinstructions for e-voting are provided in the Notice of AGM.


As per directions of Ministry of Power Government of India REC has organized variouscleanliness programmes i.e. "Swachhta Abhiyan'' (National Cleanliness Campaign) fromSeptember 25 2015 to October 112015 and "Swachh Bharat Abhiyan" from June 222015 to June 26 2015 at SCOPE and all other offices of the Company. During thecleanliness programs banners & posters were fixed in and around office premises tospread awareness among employees and general public. All employees of REC participatedwith great enthusiasm and zeal & undertook special cleanliness drive of theirrespective office premises toilets stairs lifts & other surrounding areas. Old andunwanted records have been weeded out as per Record Retention Schedule. In this processaprox. 5000 kg waste official papers magazines periodicals draft reports etc. weredisposed off. Printing of logo of "Swachh Bharat Mission" on all file coversenvelops and letter heads of the Company still continues in REC for creating awarenessabout cleanliness.Cleanliness is continuous process and it will continue in REC.


Your Company has taken necessary steps for the Implementation of "Right toInformation Act 2005 (RTI)" in the Company and independent RTI Cell has been set upfor coordinating the work relating to receipt of applications and furnishing informationthereto. RTI Handbook both in English and Hindi has been placed on REC website which isupdated periodically.

The status of RTI applications and appeals during the financial year 2015-16 is asfollows:

Particulars Nos.
1. Applications received (upto March 31 2016) 345
2. Applications disposed off (upto March 31 2016) 322
3. Applications disposed off subsequently 23
4. Appeals received by First Appellate Authority REC 25
5. Appeals disposed off by First Appellate Authority REC 25
6. Second Appeal notice received from Central Information Commission (CIC) 5
7. Second Appeal disposed off by Central Information Commission (CIC) 5


REC has adopted "Public Interest Disclosure and Protection of Informers"(PIDPI) Resolution as issued by Central Vigilance Commission vide Office OrderNo.33/5/2004 dated May 17 2004 and the same has also been incorporated in the"Vigilance Hand Book" issued by Vigilance Division. REC has also adopted aseparate 'Whistle Blower Policy' as per directives of SEBI and provisions of CompaniesAct 2013.


To encourage participation of Micro Small and Medium Enterprises (MSMEs) all thedirectives mentioned in the public procurement policy order 2012 have been included inREC procurement guidelines including MSEs owned by SC/ST and it has also been uploaded onREC's website at the link: ProcurementPolicy.pdf

REC being financial institution is not executing any project. Hence only pettypurchase i.e. stationery and office equipment from small vendors are being made. Howeverno target has been fixed for financial year 2016-17 to this effect.


In line with the provisions of Sexual Harassment of Women at Workplace (PreventionProhibition & Redressal) Act 2013 an 'Internal Complaints Committee' has beenconstituted in the Company for redressal of complaint(s) against sexual harassment ofwomen employees. The committee is headed by a senior woman official of the Company andincludes a representative from an NGO as one of its membe Rs. Anti-sexual harassmentstance of the Company is also outlined in REC (Conduct Discipline and Appeal) Rules.

During the financial year 2015-16 the Company did not receive any complaint of sexualharassment.


Pursuant to Section 92(3) of the Companies Act 2013 read with Rule 12(1) of theCompanies (Management and Administration) Rules 2014 an extract of Annual Return in FormMGT - 9 is annexed to this Report.


The particulars of contract or arrangement entered into by the Company with relatedparties as per the provisions of the Companies Act 2013 are disclosed in Form AOC-2 isannexed to this Report.


M/s Raj Har Gopal & Co. Chartered Accountants (Firm Reg No.: 002074N) New Delhiand M/s A.R. & Co. Chartered Accountants (Firm Reg No.: 002744C) New Delhi wereappointed as Statutory Auditors of your Company for the financial year 2015-16 by theComptroller and Auditor General (C&AG) of India. The Statutory Auditors have auditedthe Financial Statements of the Company for the financial year ended March 31 2016.

Further the Comptroller and Auditor General (C&AG) of India in exercise of powersconferred under Section 139 of the Companies Act 2013 has appointed M/s. Raj Har Gopal& Co. Chartered Accountants (Firm Reg. No.: 002074N) New Delhi and M/s. A. R. &Co. Chartered Accountants (Firm Reg. No.: 002744C) New Delhi as the Statutory Auditorsof the Company for the financial year 2016-17 and the Statutory Auditors have alsoaccepted their appointment. Approval of the Members of the Company will be obtained in theensuing Annual General Meeting to authorize the Board of Directors of the Company to fixthe remuneration of Auditors for the financial year 2016-17.


M/s Chandrasekaran Associates Practicing Company Secretaries (Certificate of PracticeNo. 5673) New Delhi were appointed as Secretarial Auditors of the Company for carryingout Secretarial Audit for the financial year 2015-16. In terms of Section 204 of theCompanies Act 2013 and Rules made thereunder they have issued Secretarial Audit Reportfor the financial year 2015-16 and the same is annexed to this Report.

37.1 Management's Comments on the Auditors' Report

Though auditors have not given any qualifications reservations adverse remarks ordisclaimers in their report on standalone and consolidated financial statements of theCompany but have made certain observations on further strengthening of the internalfinancial controls. Accordingly the auditor observations and Management Reply to theobservations are submitted as under:

Observation of Statutory Auditors Management's Reply
Annexure to the Independent Auditors' Report referred under 'Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act 2013 ("the Act")' of Independent Auditors' Report on Standalone Financial Statements (Annexure-C) & Consolidated Financial Statements (Annexure-A).
In our opinion the Company has in all material aspects an adequate internal financial control system except improvement in ERP system relating to classification of loans & advances as secured or unsecured determination of non-performing assets in the ERP system shift in the moratorium period due to structuring/restructuring revalidation of the sanctions of loans and recording of non-entertaining/rejection/disposal of applications of the loans and time frame for furnishing replies of Internal audit reports by concerned offices. Continuous efforts are being made to further strengthen the internal control in the said areas.

The Secretarial Auditors of the Company have given an unqualified report for thefinancial year 2015-16. However they have certain observations relating to composition ofthe Board and its Committees. The Management's Reply to the observations are submitted asunder:

Observations of Secretarial Auditors Management's Reply
1. The Company has not complied with provision of Section 149 of the Companies Act 2013 read with clause 49 of the Listing Agreement and SEBI (Listing Obligations and Disclosure REC is a Government Company and as per provisions of Article 82 of Articles of Association of the Company the power of appointment of Directors on the Board of the Company is vested with the President of India acting through administrative Ministry.
Requirements) Regulations 2015 as applicable in respect to the Composition of the Board of Directors i.e. appointment of Independent Directors and Woman Director. During the financial year 2015-16 consequent upon appointment of three Independent Directors on the Board of the Company the Composition of the Audit Committee Nomination and Remuneration Committee & Corporate Social Responsibility Committee of the Company are in compliance with provisions of the Companies Act 2013 SEBI (LODR) Regulations 2015 and DPE Guidelines on Corporate Governance for CPSEs with effect from December 22 2015.
2. The Company has not complied with provision of section 177 and 178 of the Companies Act 2013 with respect to Composition of the Audit Committee and Nomination and Remuneration Committee till December 22 2015. As on March 31 2016 the Company has three Executive Directors three Independent Directors and one Government Nominee Director and vacancy of one Woman Independent Director exist on the Board of the Company. The Company has requested the Ministry of Power to fill the vacancy of one Woman Independent Director on the Board and the same is under process.
3. The Company has not complied with provision of section 135 of the Companies Act 2013 with respect to Composition of Corporate Social Responsibility Committee till December 22 2015. Once a Woman Independent Director is appointed on the Board the Company would be in compliance with the provisions of the Companies Act 2013 SEBI (LODR) Regulations 2015 and DPE Guidelines on Corporate Governance for CPSEs relating to composition of Board.


The Comptroller and Auditor General (C&AG) of India through letters dated July 222016 has given 'NIL' Comments on the Standalone & Consolidated Audited FinancialStatements of the Company for the year ended March 31 2016 under Section 143 (6) (a) ofthe Companies Act 2013. The Comments of C&AG for the financial year 2015-16 have beenplaced along with the report of Statutory Auditors of the Company elsewhere in this AnnualReport.


In compliance to the requirements of SEBI (LODR) Regulations 2015 the details ofDebenture Trustees appointed by the Company for different series of Bonds issued by theCompany from time to time is annexed to this report.


a) There was no change in the nature of business of the Company during the financialyear 2015-16.

b) The Company has not accepted any public deposits during the financial year 2015-16.

c) No significant and material orders were passed by the regulators or courts ortribunals impacting the going concern status and Company's operations in future.

d) The Company maintains an adequate system of Internal Controls including suitablemonitoring procedures which ensure accurate and timely financial reporting of varioustransactions efficiency of operations and compliance with statutory laws regulations andCompany policies. For details please refer to the 'Management Discussion and Analysis'annexed to this report.

e) Pursuant to Section 186(11) of the Companies Act 2013 loans made guarantees givenor securities provided by a company engaged in the business of financing of companies orof providing infrastructural facilities in the ordinary course of its business are notapplicable to the Company hence no disclosure is required to be made. Further thedetails of investments are given at Note No. 10 of Notes to Accounts to StandaloneFinancial Statements.

f) Since the provisions of Section 197 of the Companies Act 2013 and Rules madethereunder are not applicable to Government Companies no disclosure is required to bemade.

g) There are no material changes and commitments affecting the financial position ofthe Company which has occurred between the end of the financial year i.e. March 31 2016and the date of this report.

h) The Company has not issued any stock options to the Directors' or any employee ofthe Company.


The work of construction of state of art office building at City Centre Sector-29Gurgaon was started in April 2015. The proposed building is GRIHA 5 Star Net Positivebuilding having special features like fair finish concrete surfaces raised flooringradiant cooling for slabs to reduce power consumption of air conditioning IntegratedBuilding Management System (IBMS) sensor controlled lighting Bio-climatic facade withmotorized blinds solar Photo Voltaic at roof top pergola auditorium and other latesttechnological features.

M/s Chelsea West Architect New York (USA) selected through Global Architectural DesignCompetition is the Architect of the building. M/s Telecommunications Consultants IndiaLimited (A Government of India Enterprise) is Project Management Consultant of the projectand M/s JMC Project (India) Limited ^ is the contractor for the project. Presently 8consultants/sub c consultants apart from 11 vendors of international repute r are workingon the proiect. Giving utmost importance to the project REC has appointed IndianInstitute of Technology Delhi for vetting of the structural design of the building.

Till July 31 2016 RCC work in Basement - two & three has been completed. RCCwork for basement one is in progress and service work in basement three has also taken up.The project is scheduled to be completed in year 2018.


Information required to be furnished as per the Companies Act 2013 and revised listingagreements executed with Stock Exchanges in terms of SEBI (LODR) Regulations 2015 andother applicable statutory provisions is annexed to this report as under:

Particulars Annexure
Management Discussion & Analysis Report I
Report on Corporate Governance II
Auditors' Certificate on Corporate Governance III
Business Responsibility Report IV


Particulars Annexure
Secretarial Audit Report issued by the Secretarial Auditors of the Company V
Annual Report on CSR activities VI
Extract of Annual Return VII
Particulars of Contracts or Arrangements with Related Parties VIII
Details of Debenture Trustees appointed by the Company for different series of Bonds IX


The Directors are grateful to the Government of India particularly the Ministry ofPower Ministry of Finance and Ministry of Human Resource Development the NITI Aayog andthe Reserve Bank of India for their continued co-operation support and guidance ineffective management of the Company's affairs and resources.

The Directors thank the State Governments State Electricity Boards State PowerUtilities and other Borrowers for their continued support and trust in the Company.

The Directors also place on record their sincere appreciation for the continued supportand goodwill of the esteemed Shareholders Investors in REC Bonds domestic and overseasBanks Life Insurance Corporation of India KfW of Germany and JICA of Japan in the fundraising programmes of the Company.

The Directors also thank M/s Raj Har Gopal & Co. and M/s A.R & Co. StatutoryAuditors M/s Chandrasekaran Associates Secretarial Auditors and the Comptroller &Auditor General of India for their valued contribution.

The Directors also sincerely appreciate and thank all the employees of the Company fortheir valuable contribution and dedicated efforts in steering the Company to excellentperformance for yet another year in succession.

For and on behalf of the Board of Directors
(Rajeev Sharma)
Chairman & Managing Director
(DIN 00973413)
Place : New Delhi
Date : August 11 2016