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Rural Electrification Corporation Ltd.

BSE: 532955 Sector: Financials
NSE: RECLTD ISIN Code: INE020B01018
BSE 00:00 | 22 Jun 110.80 0.20
(0.18%)
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NSE 00:00 | 22 Jun 110.85 0.35
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OPEN 110.10
PREVIOUS CLOSE 110.60
VOLUME 143919
52-Week high 189.00
52-Week low 107.10
P/E 4.71
Mkt Cap.(Rs cr) 21,882
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 110.10
CLOSE 110.60
VOLUME 143919
52-Week high 189.00
52-Week low 107.10
P/E 4.71
Mkt Cap.(Rs cr) 21,882
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Rural Electrification Corporation Ltd. (RECLTD) - Director Report

Company director report

To

The Shareholders

Your Directors have pleasure in presenting the Forty Eighth Annual Report together withthe Audited Financial Statements of your Company for the financial year ended March 312017.

1. PERFORMANCE HIGHLIGHTS

1.1 The highlights of performance of the Company for the financial year 2016-17 were asunder with comparative position of previous year's performance:

(' in crore)
Parameter FY 2016-17 FY 2015-16
Loans Sanctioned 83870.82 65471.10
Disbursements 58038.61 46025.83
Subsidy under DDUGJY-RE and DDG 8037.54 5023.99
Recoveries (including interest) 46747.17 47921.00
Total Operating Income 23350.79 23638.35
Profit Before Tax 8860.70 8045.21
Profit After Tax 6245.76 5627.66

1.2 Financial Performance

The total operating income of your Company for the financial year 2016-17 was '23350.79 crore as compared to ' 23638.35 crore during the financial year 2015-16. Theprofit after tax increased by 11% to ' 6245.76 crore from ' 5627.66 crore for theprevious year.

Loan asset book of your Company as on March 31 2017 was ' 201928.67 crore ascompared to ' 201278.29 crore in the previous year. The increase in Loan assets is afterconsidering the repayment of loans of ' 33910.05 crore received under Ujwal DISCOMAssurance Yojana (UDAY). Further the outstanding borrowings as on March 31 2017 were '167517.39 crore.

Earnings Per Share (EPS) for the financial year ended March 31 2017 was ' 31.63 pershare of ' 10/- each. Net worth of the Company as on March 31 2017 has increased by 16%to ' 33325.59 crore from ' 28617.76 crore.

1.3 Dividend

In addition to interim dividend of ' 7.00 per share paid in March 2017 the Board ofDirectors of your Company have recommended final dividend of ' 2.65 per share for thefinancial year 2016-17 which is subject to approval of the Shareholders in the 48thAnnual General Meeting. The total dividend for the financial year 2016-17 will work out to' 9.65 per share representing 96.5% of the paid-up share capital of the Company asagainst ' 17.10 per share representing 171% of the paid-up share capital of the Companyin the previous year (the decrease in the percentage of dividend from previous year isdue to the issue of Bonus shares in the ratio of 1:1 during the year). The total dividendpay-out for the financial year 2016-17 will amount to ' 1905.80 crore (excluding dividenddistribution tax of ' 384 crore).

1.4 Share Capital

As on March 312016 the Authorized share Capital of the Company was ' 1200 croreconsisting of 120 crore equity shares of ' 10/- each and during the financial year2016-17 the Authorised Capital of the Company was increased from ' 1200 crore to ' 5000crore as approved by the shareholders of the Company in its 47th Annual GeneralMeeting held on September 212016.

During the financial year 2016-17 the shareholders of the Company in the 47thAGM also approved the proposal for issue of Bonus shares in the ratio 1:1 (i.e. One newequity share of ' 10/- each for every equity share of '10/- each). Subsequently987459000 bonus shares were issued & allotted on September 30 2016 and werecredited to eligible shareholders by October 6 2016. Consequent to issue of Bonus sharesthe Issued and Paid up Share Capital of the Company was increased from ' 987.46 croreconsisting of 987459000 equity shares of ' 10/- each to ' 1974.92 crore consisting of1974918000 equity shares of ' 10/- each.

Further the President of India acting through Ministry of Power Government of Indiadivested/sold 25133733 equity shares i.e. 1.28 % of total paid up capital of theCompany on January 25 2017 and 9897155 equity shares i.e. 0.50% of total paid upcapital of the Company on March 22 2017 through off market sale of shares under theCentral Public Sector Enterprises Exchange Traded Fund (CPSE ETF). Accordingly as onMarch 31 2017 the President of India holds 1162504472 equity shares i.e. 58.86% ofthe paid up equity share capital of the Company.

2. LOANS SANCTIONED

The Company sanctioned loans worth ' 83870.82 crore during the financial year 2016-17as against ' 65471.10 crore in the previous year. The state-wise and category-wisebreak-up of loans sanctioned during the financial year are given in Table-1 and Table-2respectively. The cumulative sanctions upto March 31 2017 made by your Company since itsinception was ' 765350.05 crore as detailed in Table-3.

3. DISBURSEMENTS

A total sum of ' 58038.61 crore was disbursed during the financial year 2016-17 asagainst ' 46025.83 crore in the previous year. Further an amount of ' 8037.54 crore(subsidy of ' 7876.85 crore under RE component of DDUGJY and subsidy of ' 160.69 croreunder DDG) under DDUGJY has been disbursed. The cumulative amount disbursed sinceinception up to March 31 2017 was ' 387577.01 crore excluding subsidy under DDUGJY-REand DDG. The state-wise disbursements and repayment of loan by borrowers during thefinancial year 2016-17 together with cumulative figures and outstanding as on March 312017 are given in Table-4.

4. RECOVERIES

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 2016-17 was ' 46298 crore as compared to ' 48278 croreduring the previous year. The Company recovered a total sum of ' 45169 crore towardsperforming assets during the financial year 2016-17 as against ' 46641 crore during theprevious year. The Company achieved recovery rate of 97.56% for the financial year2016-17. The overdues from defaulting borrowers pertaining to Performing Assets as onMarch 31 2017 was ' 1129 crore.

4.2 Your Company's Non-Performing Assets (NPAs) continue to be at low levels. As onMarch 31 2017 the gross NPA was ' 4872.68 crore which was 2.41% of Gross Loan Assetsand the net NPA was ' 3237.34 crore which was 1.62% of Net Loan Assets. Further nodoubtful loans have been rescheduled by the Company during the financial year 2016-17.The details of loans rescheduled during the financial year 2016-17 and their position ason March 31 2017 are as under:

('in crore)
particulars FY 2016-17 FY 2015-16
Standard Loans No. of Borrowers 19 23
Amount Outstanding 27784.80 22829.88
Sub-Standard Loans No. of Borrowers 0 3
Amount Outstanding 0 1402.44
Total No. of Borrowers 19 26
Amount Outstanding 27784.80 24232.32

5. financial review

5.1 Summary of Financial Results

The summary of audited financial results of the Company for the financial year 2016-17vis-a-vis 2015-16 is given as under:

(' in crore)

particulars

Standalone

Consolidated

FY 2016-17 FY 2015-16 FY 2016-17 FY 2015-16
Revenue from Operations 23350.79 23638.35 23945.16 24012.88
Other Income 744.56 117.93 740.84 117.05
Total Income 24095.35 23756.28 24686.00 24129.93
Finance Costs 13775.12 14283.12 13786.36 14282.35
Other Operating Expenses 350.06 338.10 816.97 604.74
Provisions and Contingencies 1109.47 1089.85 1110.31 1096.18
Total Expenses 15234.65 15711.07 15713.64 15983.27
Profit Before Tax 8860.70 8045.21 8972.36 8146.66
Provision for Taxation 2614.94 2417.55 2658.99 2455.24
Profit After Tax 6245.76 5627.66 6313.37 5691.42
Less : appropriations
Transfer to Special Reserve u/s 36(1 )(viii) of the Income Tax Act 1961 1881.06 1900.00 1881.06 1900.00
Transfer to Reserve for Bad & Doubtful Debts u/s 36(1)(viia) of the Income Tax Act 1961 413.33 390.00 413.33 390.00
Dividend *1382.44 1688.55 *1382.44 1688.55
Dividend Distribution Tax *277.46 341.71 *277.46 345.68
Transfer to Debenture Redemption Reserve 196.59 196.59 201.20 196.59
Transfer to General Reserve - 570.00 3.50 572.89
Surplus carried over to Balance Sheet 2094.88 540.81 2154.38 597.71

*The figures of dividend and dividend distribution tax does not include the respectiveamounts pertaining to Final Dividend for the financial year 2016-17 (as detailed in para1.3 above) considering that the Company is not required to make any provision in thisregard in terms of Revised Accounting Standard 4.

5.2 Contribution to National Exchequer

During the financial year 2016-17 the Company contributed an amount of ' 4097.79crore as compared to ' 3749.55 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:

particulars FY 2016-17 FY 2015-16
Dividend paid to the Government of India 1126.05 880.19
Dividend Distribution Tax 379.98 293.47
Direct Taxes 2546.34 2540.96
Service Tax paid including CENVAT credit 45.42 34.93
Total 4097.79 3749.55

5.3 Ratio Analysis

A comparative statement of important ratios of the Company for the financial year2016-17 vis-a-vis 2015-16 is as below:

particulars FY 2016-17 FY 2015-16
Earnings Per Share (?) 31.63 28.50
Return on Average Net Worth (%) 20.17 21.05
Book Value per Share (?) 168.75 144.91
Debt Equity Ratio (times) 5.03 5.91
Price Earnings Ratio (times)* 5.72 2.92
Interest Coverage Ratio (times) 1.64 1.56

*PE Ratio has been calculated on the basis of Closing Price of equity share of REC atNSE as on March 312017 & March 312016 respectively.

5.4 Resource Mobilization

The Company mobilized ' 28495.18 crore from the market during the financial year2016-17. This includes ' 7662.92 crore by way of Capital Gain Tax Exemption Bonds '18600 crore by way of Institutional Bonds ' 2232.26 crore (i.e USD 330 million) fromExternal Commercial Borrowings (ECB). Further an amount of ' 19916.85 crore was alsoraised through Commercial Paper (CP).

Raised Green Bonds of USD 450 Million from International Markets

On June 30 2017 REC has launched its maiden USD Green Bonds to become the firstIndian PSU to launch Green Bonds denominated in US Dollars and raised USD 450 million fora tenure of ten years from the offshore market against the backdrop of green energy'senormous potential in the Indian power sector and the Indian Government's thrust ondeveloping this space.

The bonds have been issued at a yield of 3.965 per cent and have been offered underREC's existing USD 1 billion Medium Term Note (MTN) programme. The Green Bonds are listedon the London Stock Exchange and Singapore Stock Exchange.

The Green Bonds have been certified by the Climate Bond Initiative London while the‘Green Bond framework' formulated by REC has been verified by KPMG. The proceeds willbe allocated for financing existing projects including re-financing and new eligible greenprojects in solar wind biomass and small hydro (less than 25 MW) subject toavailability of sector-specific technical criteria under Climate Bonds Standard. ANZBarclays Bank BNP Paribas Mizuho Securities MUFG Securities and HSBC were the JointLead Managers to the issue.

Cash Credit Facilities

The Company has an approved cash credit/WCDL limit of ' 5710 crore for availment fromvarious banks for its day-to-day operations.

5.5 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.

International

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.

5.6 Cost of Borrowing

The overall weighted average annualized interest rate of borrowing for the funds raisedduring the financial year 2016-17 was 6.79% p.a. and for the borrowings outstanding as onMarch 31 2017 is 8.02% p.a. As a result your Company was able to deliver debt financingat competitive rates.

5.7 Redemption and pre-payment

During the year the Company repaid a sum of ' 23490.05 crore. This includes repaymentamounting to ' 14910.60 crore to Institutional bondholders ' 5349.91 crore worth ofCapital Gain Tax Exemption Bonds ' 130.75 crore towards Infrastructure Bonds ' 2695.51crore of External Commercial Borrowings and ' 403.28 crore of Official DevelopmentAssistance (ODA) loan. The Company also redeemed long term loan of ' 350 crore andCommercial Papers of ' 25750 crore.

5.8 Financial status at the close of the year

At the close of the financial year 2016-17 the total resources of your Company stoodat ' 209236.24 crore. Out of this Equity Share Capital contributed ' 1974.92 crorereserves and surplus stood at ' 31350.67 crore Loans from Financial InstitutionsCommercial Banks and market borrowings through Bonds and Commercial Papers accounted for '167517.39 crore Deferred Tax Liabilities of ' 40.26 crore and other liabilities &provisions stood at ' 8353.00 crore. These funds were deployed as Long / Short Term Loansof ' 200293.33 crore (net of allowances ' 1635.34 crore) fixed assets (net ofdepreciation) of ' 181.26 crore (including Capital Work in progress) Investments of '2696.45 crore Cash & Bank Balances of ' 4490.02 crore and other assets of '1575.18 crore.

5.9 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 applicable statutory requirements. During the yearthe Company has adopted / amended various policies and guidelines such as Guidelines forPrivate Sector Renewable Energy projects by revision in sole lending limits Revision ininterest rates for non-conventional generation projects Policy for investment/deploymentof short term surplus funds Revision in Policy Guidelines for prematurerepayment/pre-payment of loans Modification in policy on granting interest rate rebate tostate sector utilities/CPSUs Policy Guidelines for monitoring DE Ratio and COD Extensionof State Sector projects Dividend Distribution Policy and Amendment in CSR &Sustainability Policy etc.

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

6. PRESENT TRANSMISSION & DISTRIBUTION SCENARIO

The present scenario of Transmission and Distribution (T&D) industry is verydynamic with increasing resolve of State Governments to provide reliable power supply toconsumers and integration requirements of huge upcoming Renewable Energy Sources with theelectricity grid. Based on CEA report as on March 31 2017 the installed generationcapacity of Central State as well as Private utilities of the country is now a high ofapproximate 327 GW. Further as per LGBR for 2017-18 of CEA the Country would have peakpower surplus of 6.8% and energy surplus of 8.8%; which is a really envious position to bein. This may lead to complete phase shift in power scenario of the country vis-a-vis theone which we are traditionally used to with even currently huge generation capacitieslying stranded for the want of adequate power purchase willingness of DISCOMs and mainlythe lack of availability of requisite backbone infrastructure at transmission as well asdistribution level.

Enormous capacities are planned to be added through Renewable Sources of energy withthe ambitious goal of 175 GW by 2022 and this itself seems fraught of many risks emanatingfrom increasingly lower tariffs from each subsequent bidding low cost financingrequirements etc. However the setting up of dedicated Solar Parks along-with makingavailable all major clearances like land transmission connectivity etc. by therespective Central / State Government agencies has mitigated these risks to a greatextent. Proper planning for further transmission and distribution system development inthis light and that the energy from these sources may be largely intermittent has becomeeven more pertinent. Accordingly dedicated Green Transmission Corridors are being plannedalong-with strengthening / augmenting the transmission system to take care of such supply/ loading parameters. All this shall pose requirement for planning in line with upcomingrenewable energy capacity developments and earnest creation of infrastructure to ensuresystem availability within the short gestation periods required for renewable generatingstations development thus putting additional onus of TRANSCOs and DISCOMs for systemaugmentation.

However Distribution remains to be weakest link in the power sector value chain andmost difficult to deal with due to various reasons. Your Company has always strived toplay an active role in creation of new infrastructure and augmentation/ strengthening ofthe existing network. Your Company encourages the DISCOMs to expedite various reformmeasures and to adopt best practices including modernization and automation ofsystems/smart grid IT-enabled systems for metering and consumer services othertechnology interventions in the distribution sector & helps them in improving theiroperational and financial performance. Since distribution is gateway for all the revenuecoming into the power sector it plays a pivotal role in development and sustainability ofentire power sector.

Major challenges presently being faced by distribution sector includes accumulatedlosses & depleted net worth of DISCOMs which has severely hindered 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 rationalization leading to cross subsidy open access issues delayin release of subsidy by State Government delayed revenue collection cycle etc. havecaused a dent in their cash flows. The overall performance of state distribution utilitieshas been an issue of concern due to the above factors. Keeping in tune with the times anddynamic environment wherein utilities are struggling and striving hard to meet theconsumer expectations your Company today finances entire gamut of distribution projects& is always ready to consider special dispensation/ requirements of DISCOMs based onthe prudence/merit and sound appraisal mechanism. A dedicated Strategic Business Group hasbeen set up in the Company for this purpose. UDAY the ambitious scheme of Government ofIndia under which most of the states has already signed MoU and are taking actions as perthe scheme the improvement of operational parameters will take some time as also definedin MoU.

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 programmes like DDUGJY(Nodal Agency) IPDS UDAY NEF (Nodal Agency) Smart Grid task force etc. With thesemajor interventions your Company is optimistic that distribution scenario would be muchbetter in not too distant future when the results and effect of these interventions inconjunction with the reform measures by the respective states starts trickling in andtransform the landscape of distribution.

Also Cross Border Trade of Electricity is currently been taking place with BangladeshBhutan and Nepal under bilateral MoU / Power Trade Agreement. In order to facilitate andpromote cross border trade of electricity with greater transparency consistency andpredictability in regulatory approaches across jurisdictions and minimize perception ofregulatory risks the Guidelines on Cross Border Trade of Electricity have been notifiedby Government of India. Further various other changes are being proposed

in the Standard Bidding Documents of Transmission Projects being executed on TariffBased Competitive Bidding in reference to making EPC contractors eligible forparticipating in development of such projects and change in development model from BOOM toBOOT etc. Similar to this few changes have been notified in the Standard BiddingDocuments of conventional Generation projects as well.

In terms of changing economic environment Regulators have revised the Return on Equityfor various types of power projects to realign the sector to these changes. Further therevision in policies in respect of Short Term and Medium Term Power Purchase by DISCOMsshall help improve transparency and financial viability of their operations. All these areexpected to ensure the balanced development of the sector in conjunction with the changingrealities of the country such that adequate capital investment is promoted and interestof power consumers is also secured.

6.1 Major reforms in Distribution Sector

Government of India (Gol) 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 etc.to provide a comprehensive framework and also the blueprint for power sector reforms.Further some of the DISCOMs have gone ahead in appointing franchisees on case to casebasis in order to improve operational efficiency in particular areas. Moreover underUDAY Government of India has made necessary provisions for enabling operational as wellas financial turnaround of DISCOMs to enable them in concurrently improving the quality& reliability of power supply. Further NEF-Interest Subsidy Scheme is also underimplementation with objective to promote capital investment & expedite the reformprocess in distribution sector. The financial outlay of DDUGJY is of ' 43033 crore(Government of India budgetary support of ' 33453 crore) and IPDS with total outlay of '32612 crore (Government of India budgetary support of ' 25354 crore) should provideconsiderable fillip to the pace of capital investments in distribution sector withoutputting much strain on already stressed balance sheets of DISCOMs. REC is the Nodal Agencyfor implementation of DDUGJY & NEF scheme and is playing a key role in supporting theefforts of Government of India in implementation of UDAY REC has also been providingcounterpart funding for a large number of DDUGJY and IPDS projects.

"Power for All" document has now been signed by all States and shows thecommitment across length and breadth of the country to finally work towards achieving theobjective which not so much in distant past seemed impossible. PFA document has enabledprojecting all the capital expenditure by respective states as is required to achieve 24X7power for all including the Generation (Conventional / Non-Conventional) TransmissionDistribution etc. and has thus brought forth the efforts required to achieve the same.The requirement of Capital Expenditure projected under the programme is huge and variousMultilateral Agencies e.g World Bank Asia Infrastructure Investment Bank etc. have showntheir willingness to participate in the same. Your Company has been instrumental indevelopment of "Power for All" Web-Portal and is earnestly assisting Ministry ofPower in this endeavour. Your Company is also supporting these efforts by partnering withrespective State Utilities in their efforts in terms of making available requisitefinancing as well as through working with Central & State Governments to resolve anypotential issues in achievement of this objective.

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 enables these DISCOMs to weigh their strengths & weaknesses and facilitate afocused approach for achieving further improvements in their operational and financialperformance. It also aids 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. The Government of India is promoting development of 100 smart cities whichshall further lead to plethora of requirements and necessities in further adoption oftechnology 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 results 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 theGovernment of India State Governments and DISCOMs; however the state of distributionsegment on the consolidated level though on improved trajectory but currently remainsweak. The DISCOMs are having fragile balance sheets face prolonged project executiondelays incurring lesser capital expenditure engaging in reduced power procurement due toongoing gap between per unit revenue and cost of supply. Though the utilities are workingon reducing this gap through regular tariff filings and demand for Return on Equity by theDISCOMs; however the targets set for performance achievement are regularly being missedby majority of DISCOMs leading to inadequate tariff transmission through the mechanism.The increased capital expenditure on part of DISCOMs may enable the strengthening ofnetwork such that the huge cost burden due to persistently high level of AT&C lossesmay be brought down and consequently the quality/reliability of supply to the endconsumers may be ensured.

6.2 Ujwal DISCOM Assurance Yojana

UDAY launched in November 2015 is a path breaking reform for realizing the Hon'blePrime Minister's vision of affordable and accessible 24x7 power for all. Financiallystressed DISCOMs were incapable of supplying adequate power at affordable rates which hasfor long hampered the quality of life overall economic growth and development in thecountry. Efforts towards 100% village electrification and then 100% householdelectrification 24x7 power supply and clean energy cannot be achieved without undertakingadequate capacity building of DISCOMs. Moreover the issues of frequent power outages needearnest resolution for meeting national priorities like "Make in India" and"Digital India". Unresolved legacy issues with DISCOMs have however kept themtrapped in vicious cycle with operational losses being funded by debt. Outstanding debt ofDISCOMs had increased from about ' 2.4 lakh crore at the end of 2011-12 to about ' 4.3lakh crore in 2014-15. To ensure permanent resolution of all these long standing as wellas potential future issues UDAY had been launched which assures the rise of vibrant andefficient DISCOMs. It empowers DISCOMs with the opportunity to break even in 2-4 years.This is largely through four initiatives (i) Improving operational efficiencies ofDISCOMs; (ii) Reduction of cost of power; (iii) Reduction in interest cost of DISCOMs; and(iv) Enforcing financial discipline on DISCOMs through alignment with State finances.

The programme has witnessed significant traction from various State Governments/DISCOMs already and 27 States/UT are now part of UDAY fold with 16 States joining forComprehensive Improvement and balance 10 States & 1 UT joining for OperationalTurnaround. With just over a year of its commencement UDAY is already showing encouragingresults. ' 2.09 lakh crore worth of DISCOM liabilities have been taken over by StateGovernments and additionally ' 0.23 lakh crore has been restructured / repriced throughissuance of bonds already; thus cleaning the balance sheets of DISCOMs and enabling themto restart the Capital Expenditure cycle while also enabling financially viable operationsof all power sector stakeholders i.e. DISCOMs TRANSCOs GENCOs IPPs Banks / FIs etc.

Your Company has been instrumental in development of UDAY Web Portalhttps://www.udav.gov.in and UDAY Mobile App which is a key enabler in achieving the majorobjectives outlined under the programme. Through Web Portal / Mobile App all the detailswith respect to DISCOMs' performance are readily available vis-a-vis planned trajectoryunder the scheme. Accordingly any deviations in the performance get suitably highlightedfor all stakeholders thus prompting DISCOMs to take corrective actions and others toappropriately assess their condition. The latest information with respect to DISCOMs'performance is now available for use largely within gap of 1 to 3 months.

UDAY by encompassing all the key initiatives required to turnaround the sector is aprogramme not just for strengthening of DISCOMs but is keenly handling most of thecurrent as well as impending issues of the entire power sector by providing a centralplatform to participating States for taking up any and all of their concerns / issues withrelevant stakeholders. Further UDAY has undertaken to resolve coal rationalization issues& efficiency improvement of conventional generation segment through NTPC handholdingetc. ensuring better RPO compliance to promote non-conventional generation and lossreduction of transmission segment as well. Your Company is partnering with Government ofIndia to liaise with respective State Governments / Utilities to enable achievement of allthe objectives envisaged under the programme.

With UDAY implementation various UDAY States have in general witnessed the reductionin interest costs power purchase costs and improvement in operational efficiencies whichhas led to significant reduction in their AT&C losses and ACS-ARR gap as compared totheir last year performance thus enabling huge amount of savings on this account. It isexpected that in upcoming years the results of the initiative will become morepronounced.

6.3 National Electricity Fund

REC is Nodal Agency for National Electricity Fund (NEF) - interest subsidy schemehaving provision of ' 8466 crore (against interest subsidy) to be provided over 14 yearson loan disbursements amounting to ' 25000 crore for distribution schemes sanctionedduring the 2 years viz. 2012-13 and 2013-14. Ministry of Power Government of India shallprovide interest subsidy on loans disbursed to the State Power Utilities DistributionCompanies both in public and private sector to improve the infrastructure in distributionsector. The scheme is reform linked and interest subsidy of 3% to 7% is payable to theDISCOMs on achievement on reform based parameters outlined in NEF guidelines. During thefinancial year 2012-13 & 2013-14 your Company has already sanctioned projects of '25000 crore to 25 DISCOMs in 15 states for taking benefits under NEF. The utilities fromthe states of Uttarakhand Madhya Pradesh Haryana Rajasthan Karnataka Punjab GujaratWest Bengal Andhra Pradesh and Telangana have already benefitted from the interestsubsidy of ' 59.34 crore approved under the scheme.

6.4 Urja Mitra

Urja Mitra is a distribution sector initiative of Ministry of Power being implementedthrough your Company's subsidiary RECTPCL.

Urja Mitra is first of its kind application which provides a Central platform(Web-Portal www.uriamitra.com as well as Mobile App) for State Power Distributionutilities to disseminate Power Outage information to urban / rural power consumers acrossIndia through SMS/email/push notifications. Power Consumers across the nation shall haveprior intimation of expected duration and cause of scheduled power outages and post faultintimation of unscheduled power outages duration. It also provides a platform to view realtime power outages in any part of the country lodge a complaint on power outages etc.Stakeholder connect is ensured by providing for vernacular mobile apps which can be usedby field staff to trigger power outage information/view ongoing outages/take correctiveaction on outage complaints etc.

Data of around 10.10 crore consumers of 49 DISCOMs of 27 states has already beenuploaded into the application and more than 6.45 crore power outage SMSs have been sent tothe consumers.

6.5 11 kV Rural Feeder Monitoring Scheme

11 kV Rural Feeder Monitoring is a distribution sector initiative of Ministry of Powerbeing implemented through your Company's subsidiary RECTPCL. To get complete picture ofthe entire distribution network in country and to ensure achievement of "24x7 Powerfor All" it has been felt essential to capture real time supply parameters of ruralIndia and this can be achieved by monitoring the availability/quality of power supply inrural areas of the country by capturing actual distribution parameters i.e. Power supplyoutages and by conducting feeder wise Energy audit and AT&C losses calculation. Inorder to meet this objective "11 kV Rural Feeder Monitoring Scheme" has beenintroduced. Under the Scheme rural feeders meter data shall be acquired through modem andshall be send to central Meter Data Acquisition System (MDAS) for further analysis and thesame shall be integrated with National Power Portal (NPP) to make it available for use ofall stakeholders. This scheme targets to develop a self-sustained independent web basedautomated system for almost 1.1 lakh rural and agricultural feeders across country byacquiring various essential parameters of all the outgoing 11kV rural feeders & such66/33 kV incoming feeders from where 11kV rural feeders are emanating and making theinformation available online for all on public portal on real time basis for power supplymonitoring alerts meter data analysis information dissemination and energy audit.

The System would help for monitoring power supply proper planning decision supportand taking corrective actions on the business activities in addition to transparentlydisseminating the power supply status. It would further facilitate consolidation ofvarious parameters downloaded from the meters installed on the feeders into a commondatabase thus enabling generation of various MIS reports for analysis and actions.

6.6 Tarang

TARANG is a transmission sector initiative for its better monitoring being run underguidance from Ministry of Power through your Company's subsidiary RECTPCL which hasdeveloped "TARANG" - Transmission App for Real-Time Monitoring and Growth.TARANG provides an informative medium regarding the Pan-India progress of TransmissionSystem which can be drilled down to month wise agency wise state wise etc. for analysispurpose. The details of stalled/delayed projects is separately provided with reasons ofdelay so that all stakeholders can take a corrective decision in time to derive benefitsfrom the timely completion of the projects. TARANG monitors the progress of transmissionsystem i.e. both inter-state and intra-state through Tariff Based Competitive Bidding(TBCB) as well as Regulated Tariff Mechanism.

TARANG also shows the prospective upcoming inter-state as well as intra-state projectsalong with NITs being floated by different transmission utilities Pan-India. TARANGprovides advance information of upcoming transmission projects approved by EmpoweredCommittee on Transmission helping bidders to gear up for future transmission projects.

7. FINANCING ACTIVITIES

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 2016-17 are as under:

7.1 Generation

During the financial year 2016-17 your Company sanctioned 22 Nos. ofGeneration/R&M loans including 6 Nos. of additional loan assistance with totalfinancial outlay of ' 28208.93 crore including consortium financing with other financialinstitutions.

The breakup of loans sanctioned including additional loan assistance is as under:

particulars No. of Loans Loan Amount
STATE SECTOR
Fresh Loan 14 22497.39
Additional Loan 2 945.83
private sector
Fresh Loan 2

4765.71

Additional loan 4
Total 22 28208.93

7.2 Renewable Energy

During the year your Company sanctioned loan assistance of ' 2089.77 crore to 16 newgrid-connected Renewable Energy projects with installed generation capacity aggregating367 MW which included 11 Solar photo-voltaic projects aggregating 280 MW; 4 Small HydroPower Projects of 61 MW and 1 Wind Project of 26 MW. The total cost of these projectsaggregates to ' 3035.53 crore.

The disbursement achieved during the year was ' 1617.68 crore as detailed below:

particulars Unit FY 2016-17 FY 2015-16
Projects Sanctioned Nos. 16 11
Capacity of Sanctioned Projects MW 367 688
Cost of Projects

' in crore

3035.53 4444.78
Loan Sanctioned 2089.77 2965.72
Loan Disbursed 1617.68 304.07

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

to provide 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 2016-17 your Company sanctioned 924 Nos. of Transmission andDistribution schemes involving a total loan assistance of ' 40953.12 crore. This includesprimary power evacuation schemes associated with generating plants system improvementschemes schemes for Procurement & Installation of equipment/materials like meterstransformers conductors tower material cables etc. Government approved schemes likeDDUGJY & IPDS schemes and Infrastructure schemes for providing electricity access tovarious categories of Consumers including Agriculture.

7.4 Short Term Loans and others

During the financial year 2016-17 your Company has also sanctioned loans assistance of' 12619 crore (includes special loan of' 4919 crore) to various power utilities in theform of short term loans medium term loans & special loans to meet their fundsrequirement of short/ medium term & working capital etc.

7.5 Financing Activities in North Eastern States

During the financial year 2016-17 a total sum of ' 1427.18 crore was sanctioned andan amount of ' 1433.87 crore was disbursed against various projects relating toTransmission & Distribution Generation including Renewable projects etc. in NorthEastern states.

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)

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. SBG has also formulated policy for interestrate rebate to the borrowers with commissioned projects and credit rating not below thanBBB in order to extend the benefit of decrease in risk factors and improvement in riskclassification of the project due to commissioning of the project.

7.8 Investments made/disposed during the financial year 2016-17.

The Company has subscribed to 260542050 fully paid up equity shares of NHPC Limitedunder Offer For Sale (OFS) at a cost of ' 21.78 per equity share of ' 10/- eachaggregating to ' 567.50 crore in April 2016. Out of the same the Company sold76530185 equity shares at the rate of ' 32.25 per equity share under the Buy Backscheme announced by NHPC Limited in March 2017. The Company earned dividend yield of morethan 10% and capital returns of more than 40% on the sale of equity shares.

The Company was allotted 347429 fully paid up equity shares of Housing and UrbanDevelopment Corporation Limited (HUDCO) under Initial Public Offering at a price of ' 60/-per equity share of ' 10/- each amounting to ' 2.08 crore in the month of May 2017.

8. international cooperation & development

REC has availed three lines of ODA credit with KfW Germany. All of them have beenfully drawn as on March 31 2017. 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 100million (approx. ' 753.73 crore). Apart from above REC has also availed two lines of ODAcredit from JICA Japan. Both have also been fully drawn. Under JICA-I & II ODA loanscumulative amounts of JPY 16949.38 million (approx. ' 820.12 crore) and JPY 11809.48million (approx.? 640.64 crore) respectively has been drawn as on March 31 2017.

9. DEENDAYAL UpADHYAYA GRAM JYOTI YOJANA (DDUGJY)

Deendayal Upadhyaya Gram Jyoti Yojana (DDUGJY) is an integrated scheme covering allaspects of rural power distribution. Under the scheme 60% of the project cost (85% forspecial States) is provided as grant by Government of India and additional grant upto 15%(5% for special States) is provided by Government of India on achievement of prescribedmilestones. All erstwhile RE schemes (including Rajiv Gandhi Grameen Vidyutikaran Yojana)have been subsumed in DDUGJY REC is the Nodal agency for implementation of DDUGJY.

DDUGJY is a flagship programme of Government of India supplementing overall ruraldevelopment and facilitating towards "24x7 Power For All" in the country throughthe following 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/ habitations having less than 100 population is also eligible.

In order to realize the objectives of the scheme participation of all the stakeholdersparticularly public representatives has already been institutionalized throughconstitution of District Electricity Committees (now DISHA) under the Chairmanship ofsenior most Member of Parliament. DISHA is empowered to monitor and review theimplementation of DDUGJY

9.1 Village Electrification

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.

On August 15 2015 Hon'ble Prime Minister from the rampart of Red Fort announced thatall remaining Un-Electrified (UE) villages would be electrified within 1000 days. TheMinistry of Power has taken up the electrification of all 18452 UE villages on Missionmode. 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.

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 142015. 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 users.

In addition to Village electrification the emphasis has now been laid on Householdelectrification. To achieve this updated GARV App has been launched in December 2016 formonitoring Household electrification in all 5.97 Lakh villages. Further in the portal afeature named SAMVAD facilitating general public to raise their queries and interact withDISCOM officials establishing transparency and accountability has been provided toempower the common man.

9.2 Performance during financial year 2016-17:

a. Sanction:

Under DDUGJY during the financial year 2016-17 for electrification through gridprojects for ' 199.93 crore (including capital subsidy of ' 163.91 crore) in 8 States havebeen approved by the 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.During the financial year 2016-17 DDG projects for ' 255.98 crore (including capitalsubsidy of ' 203.60 crore) have been sanctioned for implementation in 6 States.

b. Fund release:

Under the scheme during the financial year 2016-17 a sum of ' 8600.60 crore (Loan '563.06 crore & Subsidy ' 8037.54 crore) has been disbursed to the Implementingagencies.

The subsidy of Government of India is channeled through REC and the matchingcontribution amount being arranged by the State Government/Implementing Agency throughLoan/Equity.

c. Progress of electrification:

During the financial year 2016-17 under DDUGJY electrification works in 6015un-electrified villages (including 298 under State Plan) and intensive electrification in63330 villages have been completed. Further free electricity connections have beenprovided to 22.42 Lakh BPL households families.

The State-wise details of sanctions fund release & progress of electrificationduring the financial year 2016-17 are enclosed in Table-5.

9.3 Cumulative Performance upto March 31 2017:

Under DDUGJY cumulatively up to March 31 2017; 5777 projects for ' 108757 crorehave been sanctioned and a sum of ' 49662 crore (including GOI grant of ' 45136 crore)have been disbursed to the Implementing agencies.

As regards to physical progress cumulatively upto March 31 2017 electrificationworks in 122159 un-electrified villages (including 771 villages under State Plan) andintensive electrification in 414563 villages have been completed. Further freeelectricity connections have been provided to 254.68 Lakh BPL households families.

To achieve village electrification on mission mode as on March 31 2017 out of 18452un-electrified villages 13123 villages have been electrified 837 villages foundin-inhabited leaving a balance of 4492 un-electrified villages and are targeted forelectrification by May 2018.

The State-wise details of Cumulative Sanction Fund release & achievements arefurnished at Table-6.

10. STANDARDIZATION QUALITY CONTROL & MONITORING

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 (RQM) 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 2016-17 RQMs have undertaken inspections of242 villages in XI Plan Phase-I projects 2122 villages & 55 Nos. of materialinspections in XI Plan Phase-II projects and 2191 villages & 1150 Nos. of materialinspections in XII Plan projects at manufacturer premises for ensuring quality of works.

11. RISK Management

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) under thechairmanship of CMD and comprises of Director (Finance) Director (Technical) ExecutiveDirectors and General Managers from Finance and Operating Divisions as its members.

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 program 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.

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 ' 500 croreor more and practices adopted by the Company and also to suggest action for mitigation ofrisk arising in the operation and other related matters of the Company. The Company hasidentified its various risks and has taken various steps to mitigate them as detailedbelow:

(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 unfavorable 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 borrowers. This could be on account of delay in the process ofenforcement or difficulty in the applicability of the contractual obligations. We seek tominimize 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 recognize and reduce operational risk in the business.

12. preferred customer policy

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's customers and to have a long termmutually beneficial relationship with them.

The Policy lays down the eligibility criterion which takes into account various factorssuch as amount of loan outstandingduration 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 variousexternal agencies as well as CIRE Hyderabad.

13. INFORMATION TECHNOLOGY INITIATIVES

The Integrated Business ERP system is in operation in REC since 2009 covering majorbusiness functions of Company which is being improved continuously by adding new features.Benefits of ERP system has been extended to the borrowers also as a part of betterservice. The ERP system is hosted at Data Centre of REC and both the Primary Data Centre(PDC) & Disaster Recovery Center (DRC) are ISO/IEC 27001:2013 certified.

Towards transparency in procurement now all procurement of goods and services ofvalue above ' 2 lakh is being done through the e-procurement system. The system comply toe-Reverse Auction as per CVC guidelines and REC Procurement guidelines. In addition REChas deployed a number of in-house developed systems as a part of IT initiatives towardsachieving better e-governance.

Your Company has implemented a full-fledged state-of-art Video Conferencing (VC)solution across all of its offices pan India. The VC facility is being used by Board ofDirectors for joining in the Meetings of Board/Committees thereof. Corporate office andall field offices of the Company are made Wi-Fi enabled. REC has initiated selection ofsuitable Data Leakage & Prevention (DLP) package for preventing sharing ofconfidential and critical information outside the corporate network.

IT initiatives also includes revamping of the website to make it more informativeresponsive with features like knowledge sharing and to use it as branding image of REC.Redesigning and revamping of existing static website to an interactive and dynamic websiteand the revamped portal will be more informative responsive and will have features likechat blog knowledge sharing and message from Chairman Desk.

As step towards providing better facility to employees HR-ERP access is now availableon internet for employees & ex-employees enabling to use it on the move. IT Divisionfacilitates and promotes the IT initiatives of Government of India like My Gove-Governance Digital India etc. within the Company. The computer to employee populationratio is 100%. IT Division also organizes and imparts various training program to upgradeComputer skills of the employees of the Company.

14. CENTRAL INSTITUTE FOR RURAL ELECTRIFICATION (CIRE)

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 organizations.The programmes are conducted on the state-of-art subjects of Power GenerationTransmission Distribution and Renewable energy sources. CIRE has been conferred with"Education Leadership Award" by reputed Business School and ABP News NationalEducational Awards consecutively for the last 3 years in recognition of 'LeadershipDevelopment Innovation and Industry Interface' of the Institute.

14.1 National Training programmes (NTp) under DDUGJY

REC/CIRE is the Nodal Agency for coordination and implementation of National TrainingProgrammes for employees of C&D category under DDUGJY/RGGVY sponsored by Ministry ofPower Government of India. During the year 2016-17 as against the remaining trainingtarget of 26151 employees of C&D category 29153 were trained. With this the targetfor training of 125000 employees of C&D category by the power utilities during XIIplan under DDUGJY is successfully achieved. In total 128002 employees of C&Dcategory are trained during XII plan period ending March 31 2017.

CIRE on the request of power utilities has conducted 78 Programmes for employees ofC&D category with 1949 participants at various locations namely Jammu/Udhampur(J&K) Jaipur/Jodhpur/Bikaner/Udaipur (Rajasthan) Berhampur (Odisha) Shimla/Solan/Dharmasala/Una/Hamirpur (HP) Indore (MP) Hisar (Haryana) Warangal (Telangana)etc. under its banner.

14.2 International programmes

CIRE is empanelled by Ministry of External Affairs Government of India to organizetraining programmes in the area of power sector under ITEC/SCAAP During the year CIRE hasorganized 8 International programmes with 169 participants on the topics viz. Solar PowerGeneration - Grid Enabling (4 weeks); Rural Electrification and Power Management (8weeks); Design Erection O&M of EHV Sub-Stations (4 weeks); Planning and Managementof Power Transmission and Distribution System (8 weeks); Best Practices in PowerDistribution (4 weeks); Management of Power Utilities using IT/Automated Solutions (5weeks); Certificate Course in Electric Power Management (12 Weeks) and Latest Trends inThermal Power Generation (4 weeks). The participants from countries viz. AfghanistanBangladesh Bhutan Cambodia Egypt Ethiopia Fiji Gambia Ghana Guyana HondurasIndonesia Iraq Mali Malawi Mauritius Mongolia Nepal Niger Nigeria PhilippinesSenegal Sudan South Sudan Suriname Syria Tajikistan Tanzania Tunisia TurkmenistanUganda and Zimbabwe have attended the programmes.

14.3 Regular National Programmes

CIRE has organized 27 Regular Training Programmes for the personnel of various PowerUtilities/Distribution Companies on different topics such as Earthing Practices &Safety Measures in Electrical Installations; Power Transformer Protection - Testing &Maintenance; Planning & Management of Solar Plants & Grid Enabling; DistributionTransformers - Recent Trends in O & M; Design & Construction of EHV Sub-stations& Quality Control; Power Trading & Energy Exchange; O&M and Protection aspectsof Distribution Sub-stations; Labour Laws - EPF ESI Employees Compensation and ContractLabour Act - Procedures in dealing with Court cases; Underground Cables - DesignLayingTesting and Maintenance; Technical Specifications and Construction Standards forDistribution System; Information Technology Applications in Power Distribution Management;Power Purchase Agreement; New Developments in Overhead Power Transmission Lines-Design toConstruction; Tariff Policy and Submission of ARRs-Regulatory Compliance; PerformanceManagement of Thermal Power Stations for improved efficiency; Gas Insulated and IndoorSub-stations; O&M of EHV Sub-stations Lines and Quality Assurance; Protection Systemfor EHV sub-station; New Techniques in Metering Billing and Collection; Open AccessPower Trading and Availability Based Tariff (ABT); Smart Grid for Smart Cities; PowerFactor Improvement and Reactive Power Management; Design & Construction ofDistribution Sub-station and Lines; Distribution Loss Reduction - Issues Challenges andRemedial Measures; Goods & Service Tax (GST); Competitive Bidding-EconomicalProcurement; and Power Distribution Management. A total number of 320 participantsattended the above programmes.

14.4 Programmes organized in collaboration

CIRE collaborated with premier Business Management Institute i.e Institute of PublicEnterprise and with subject experts and conducted 7 programmes during the year viz.Companies Act 2013 & Corporate Governance; Ind AS (IFRS) Adoption in Power Sector;Protection in Power Generating Station; Corporate Social Responsibility; MaterialManagement Purchase Procedures & E-procurement and Overhead Power Transmission LineConstruction Management with 64 participants.

14.5 Customized programmes

Five customised programmes were designed and organised suitable to the utilityrequirements. The programmes conducted are on "Efficiency Improvement Measures inDistribution System" and "Best Practices in Power Distribution Management"for MPPaKVVNL at Indore; two programmes for the Civil Engineers of Punjab State PowerCorporation Limited (PSPCL) and one ToT programme of 2-weeks duration for Jammu &Kashmir State Power Development Corporation Limited (JKSPDCL) executives on "Hydroand Solar Power Generation" at CIRE campus. In total 120 participants were trainedunder customised programmes.

14.6 In-house Training programmes

CIRE also organized 6 in-house programmes for the employees of REC and 51 employeeshave taken part in these programmes. The topics covered are Leadership Skills; BusinessCommunication and Presentation Skills; Implementation of Ind-AS in REC; LoanDocumentation; Corporate Social Responsibility and Project Appraisal Methodologies &DPR Preparation.

14.7 Skill Development programme

A Skill Development Certificate Course on "Power Management" of 6-weeksduration for the unemployed Engineers (Electrical/ Mechanical) was conducted with 28participants.

14.8 In all during the year 2016-17 in addition to coordinating and monitoring theNational Training Programmes for employees of C&D category sponsored by MoP GoICIRE has conducted 132 programmes on various themes/subjects and trained 2701 personnelwith 16314 man days of training.

15. ISO 9001:2008 QUALITY ASSURANCE CERTIFICATION

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

16. human resource management

In order to professionalize the Executive strength of the Company and also to infusefresh blood 5 Executives were appointed through Campus Recruitment during the financialyear. The total manpower of the Company as on March 31 2017 was 566 employees whichincludes 441 Executives and 125 Non-Executives.

16.1 Reservation in Employment

The directives issued by the Government of India regarding reservations in appointmentand promotion to various posts were complied with. The group wise details of SC and STemployees out of total strength as on March 31 2017 are given below:

group

Number of Employees

Total

SC

ST

FY 2016-17 FY 2015-16 FY 2016-17 FY 2015-16 FY 2016-17 FY 2015-16
A 377 391 36 40 14 14
B 84 99 12 13 2 2
C 35 36 6 7 0 0
D 70 74 21 22 2 1
Total 566 600 75 81 18 17

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 atsharpening 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 103 employees tovarious training programmesworkshops etc.within the country and abroad. In addition 10training programmes were conducted inhouse which were attended by around 100 employees.Taken together these initiatives enabled the Company to achieve 589 training man days.Further18 Executives were deputed for programmes in Japan Dubai Germany etc.

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 empaneled hospitals underDirect Payment Scheme by adding 5 hospitals. Furtherpart time services of fourspecialized doctors were engaged to provide onsite medical facilities to employees. TheCompany has also been funding sports & recreation equipment for use by employees andto promote well-being of employees and also organized a health talk/ workshop onErgonomics.

Sports Activities

During the financial year 2016-17 your Company hosted an Inter-CPSU Kabaddi Tournamentat Jaipur and also sponsored its employees for various Inter-CPSU sports tournaments suchas Badminton Table Tennis Volley Ball Kabbadi Chess Cricket etc. organized byvarious power sector CPSUs under the aegis of Power Sports Control Board (PSCB). Furtheremployees were encouraged to participate in various quiz paper presentations andsimulation competitions conducted by reputed institutions.

16.4 Representation of Women Employees

As on March 312017 the Company had 96 permanent women employees which represent16.96% of the total work force. There is no discrimination of employees on the basis ofgender. A Women's 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's Cell.

16.5 Industrial Relations

The Industrial Relations scenario in the Company continued to be cordial and harmoniousin the financial year 2016-17.There was no loss of man days 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

A Public Grievance Cell has been set up in REC for the purpose of redressing thegrievances from the public in a time bound manner. The cell handles Centralized PublicGrievance Redress and Monitoring System (CPGRAMS) portal which is a platform for thecitizens for lodging their grievances. The CPGRAMS portal is developed and maintained bythe Department of Administrative Reforms & Public Grievances (DARPG) Government ofIndia.

Further in compliance of RBI Guidelines the Company has put in place a GrievanceRedressal mechanism to resolve disputes between the company and its customers andappointed a senior official as the Grievance Redressal Officer.Further in accordance withthe guidelines issued by the Government of India the Company has constituted a GrievanceRedressal Committee to redress the grievances of employees.

17. CORPORATE SOCIAL RESPONSIBILITY & SUSTAINABLE DEVELOPMENT

The Company has its 'Corporate Social Responsibility & Sustainability Policy'aligned with the provisions of Companies Act 2013 the Companies (Corporate SocialResponsibility Policy) Rules 2014 and Guidelines for CSR and Sustainability for CentralPublic Sector Enterprises issued by Department of Public Enterprises. The copy of the 'RECCorporate Social Responsibility & Sustainability Policy' is available on the websiteof the Company at www.recindia.nic.in.

During the financial year 2016-17 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 stakeholders. 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 developmentprogramme education environmental sustainability health care including for old age andpersons with disabilities drinking water and sanitation facilities including contributionin Swachh Bharat Kosh etc.The CSR strategy has been developed with action plan inproject-based accountability approach. The CSR activities have been implemented inproject-mode with baseline survey specified time-frame identified milestones periodicmonitoring and impact assessment. Disbursement of allocated funds under CSR was linkedwith achievement of the milestones and deliverables. During the financial year 2016-17financial assistance aggregating to ' 181.23 crore was sanctioned as against CSR Budget of' 146.57 crore (@ 2% of the average net profits of previous three financial years) forvarious projects under Corporate Social Responsibility and ' 69.80 crore was disbursed. AReport on Corporate Social Responsibility and Sustainability Activities including thedetails of projects and reasons for not spending the minimum required amount during thefinancial year 2016-17 is annexed to this Report.

The information in respect of CSR projects including thematic areas location sanction& disbursement and justification for shortfall in spending the minimum requiredamount during the financial year 2016-17 are given in the Report on Corporate SocialResponsibility and Sustainability Activities annexed to this Report.

18. vigilance activities

Vigilance Division constantly endeavored to optimize probity and integrity amongemployees and to promote transparency fairness and accountability in all operationalareas. Streamlining of systems and procedures in matters relating to administrative andfinancial functions was also accorded priority.The thrust on leveraging of technology wascontinued with the result that information relating to loans schemes tenders thirdparty bills recruitment etc. are online. Tenders were scrutinized and varioussuggestions were given for enhancing competitiveness and fairness in purchase procedures.Wherever deviations were observed the matter was taken up with concerned Divisions whichled to strengthening of appraisal system/guidelines. In this direction all the employeeswere sensitized that it is essential to ensure that REC's CDA rules are followedscrupulously and highest standard of ethics and integrity are maintained by everyone atall times. Review of the Appraisal Guidelines and strengthening of controls in theexisting grading & appraisal mechanism to address the issue of Non-Performing Assetsin respect of loans disbursed to Private Sector Borrowers was also advised.

Almost all the tenders floated on or after April 1 2016 by the Company with the valueof ' 2 lakh and above were processed through E-Procurement mode. Regular review meetingswere taken up by Vigilance Division with operating Divisions on the existing systems andprocedures to make these more transparent and accountable. HR Division was advised toincorporate the provisions seeking vigilance clearance for resignation retirementofficial foreign visits in the prevalent online vigilance clearance module. Agreed Listand List of Officers of Doubtful Integrity were finalized. The matter of rotationaltransfers from the identified sensitive posts is constantly being pursued up with the HRDivision. Prescribed periodical statistical returns were also being sent to CVC and MoP ontime.

Vigilance Awareness Week (VAW) was observed in the Company from October 312016 toNovember 5 2016. During the week REC has administered Vigilance pledge conducted Essaywriting and Debate competitions and organized one-day workshop for its employees at RECCorporate office New Delhi. It has also arranged various programmes likeElocution/Debate Poem competitions in three colleges and two schools in Delhi. Programmeswere also organized in REC's Subsidiary Companies Regional Offices and State Officesspread across the country. Valedictory function of Vigilance Awareness Week was organizedin REC Corporate office on November 4 2016. The function was well attended by seniormanagement and employees of REC.

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.

The details of Immovable Property Returns (IPRs) of all Executives have been uploadedon REC's website and vigilance clearance has been linked with timely submission of IPRs.Annual Property Returns of the employees were subject to systematic scrutiny.

The performance of Vigilance Division was reviewed periodically by CVC Board ofDirectors and CMD in addition to regular reviews undertaken by the CVO in accordance withthe prescribed norms.

19. IMPLEMENTATION OF OFFICIAL LANGUAGE

Your Company is fully committed to implement the provisions of Official Language Policyof the Government of India. All efforts were made to achieve the targets set under AnnualProgramme 2016-17 issued by the Department of Official Language. During the year OfficialLanguage Implementation Committee Meetings of the Company were held to review the quantumof work done in Hindi. The implementation of Annual Programme was the primary concern ofall these meetings.

The Parliamentary Committee on Official Language conducted inspection of REC RegionalOffice Bangaluru on April 11 2016 to assess the use of Hindi in official work. Thecommittee appreciated the progress of Hindi work by Regional Office Bangalore. The reportto this effect has been sent to the Committee and MoP within the prescribed time.

Inspections related to Official Language of REC Corporate Office and REC RegionalOffice Bhubaneswar by MoP officials were successfully conducted on February 28 2017 andMarch 3 2017 respectively. Further internal inspections were also carried out by theCompetent Authority to assess the progressive use of Hindi in 6 Regional Offices.

To create a conducive environment facilitating the increased use of Hindi in theCompany Hindi fortnight was organized from September 1 2016 to September 15 2016 inCorporate office in which 9 competitions were organized for Senior Officers Middle LevelOfficers and employees including class IV employees. A total of 89 employees participatedout of which 41 employees were awarded 57 prizes in the different categories. Hindifortnight was also organized in all Regional/State offices.

Hindi statement Mujhe khushi hogi yadi ham aapas mein Hindi mein baat karein' was alsoplaced in the chambers of all DGM and above officers as well as in all internal Divisionsof the Corporate Office.

Further four Hindi workshops were also organized to give hands-on exposure toparticipants in various facets of use of Hindi in discharge of their official duties inwhich 123 Executives/Non-Executives participated. This was done to enable the employees toovercome their hesitation in doing official work in Hindi as also to impart practicalknowledge about the official language policy and related subjects. Two days Hindi Workshopwas also organized in Kolkata for Nodal Hindi Officers nominated in Regional/State/Sub-office/CIRE on November 3 & 4 2016.

Two issues (January-June 2016 and July-December 2016) of In-house Hindi Journal'Urjayan' have been published which contained interesting and useful articles as well asliterary writings by the employees.

Regional Offices Guwahati and Thiruvananthapuram bagged 2nd and 3rdprize respectively by concerned Town Official Language Committee (TOLIC) for theirexcellent work in the progressive use and implementation of official language for the year2015-16.

This year an Inter-PSU Hindi typing competition was also organized on August 5 2016by CIRE under the aegis of its TOLIC (PSUs) at Hyderabad- Secunderabad.

20. PARTICULARS REGARDING CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGNEXCHANGE EARNINGS & OUTGO.

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. Replacement ofconventional lights by LED light overall energy consciousness energy efficientequipments use of solar energy and effective monitoring of power consumption by technicalteam of SCOPE has resulted substantial saving of 2.09 million units of electricityequivalent to approximately ' 2.19 crore during financial year 2016-17.

20.2 Foreign Exchange Earnings & Outgo

No foreign exchange was earned during the financial year 2016-17. However the foreignexchange outflow aggregating to ' 1801.44 crore was made during the financial year onaccount of interest principal repayment financial charges and other expenses.

21. SUBSIDIARY COMPANIES

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)

In order to initiate development of each independent Interstate and Intrastatetransmission project allocated by Ministry of Power Government of India and StateGovernment RECTPCL incorporates Project specific Special Purpose Vehicle (SPV) as WhollyOwned Subsidiary Company and after selection of successful bidder through Tariff BasedCompetitive Bidding Process for transmission projects as notified by Ministry of Powerthe respective Project Specific SPV along with its all assets and liabilities istransferred to the selected bidder. During the financial year 2016-17 three (3) SPVs wereincorporated for allocated transmission projects four (4) SPVs were transferred to thesuccessful bidder and name of another two (2) SPVs were struck off from the Register ofCompanies under Section 560 of the Companies Act 1956. As on March 31 2017 followingproject specific Special Purpose Vehicles (SPVs) existed as Wholly Owned SubsidiaryCompanies of RECTPCL:

i. Dinchang Transmission Limited (CIN: U40300DL2015GOI288066)

ii. Ghatampur Transmission Limited (CIN: U40300DL2016GOI308788)

iii. ERSS XXI Transmission Limited (CIN: U40300DL2017GOI310436)

iv. WR-NR Power Transmission Limited (CIN: U40100DL2017GOI310478)

21.1 REC Power Distribution Company Limited

During the financial year 2016-17 RECPDCL has excelled in its core business viz.Preparation of Detailed Project Report (DPR) Third Party Inspection (TPI) MaterialInspection & Project Management Consultancy (PMC) Services Project Implementationunder R-APDRP Part-A scheme Enhancement of Energy Efficiency mission and execution ofturnkey works relating to the construction of toilets in schools under CSR initiatives ofREC under Swachh Vidyalaya Abhiyan.

The major new assignments undertaken during the financial year 2016-17 include (i) PMAworks for turnkey execution of Smart Grid project as per NSGM guidelines and deposit workof 66kV Transmission line for Chandigarh Electricity Department; (ii) Project ImplementingAgency for construction of Solar Roof Top Power Plant of 508kWp capacity at RashtrapatiBhawan under REC's CSR initiative and 16 Nos. of Solar Power Plant for SC/ST residentialSchools at Odisha under REC's Sustainable Development initiative; (iii)PMC & PIA worksfor (a) Rural Electrification Work of 895 Nos. of Off-Grid Villages in Arunachal Pradeshby installing 300Wp Solar Power Packs and 40Wp Solar Street Lights under DDUGJY; (b)Implementation of Grid connected Roof Top Solar Power Plant in Assam with RECPDCLachieving the record rates much below against the MNRE benchmark rate of ' 75/Wp; and (c)Consultancy Services for carrying out Commercial and Technical Analysis of DistributionSystem of Narsinghpur Circle (District) of M.P. Poorv Kshetra Vidyut Vitaran CompanyLimited.

Further the Company has been engaged as Lead Implementing Agency for managing BEE'sPartial Risk Guarantee Fund for Energy Efficiency and has also signed a MoU with EESL forworking as a PMC and AMC for installation of LED street lights across India as a stepforward in the Energy Efficiency sector.

Monitoring of Electrification of Un-Electrified Villages/ Households.

Ministry of Power (MoP) has decided to take electrification of all 18452Un-Electrified (UE) villages on Mission Mode. MoP has appointed REC as Nodal Agency tomonitor the progress of electrification work of UE villages and further REC has awardedthe work relating to day to day monitoring website maintenance & updation to developRE mobile application (GARV App) control room-setup call centre and quality surveillancechecks during electrification of UE villages etc. to RECPDCL on cost plus basis.

For monitoring the progress of electrification work of UE villages in an effective andspeedy manner the Company has hired and deputed young Engineers as Grameen VidyutAbhiyantas (GVAs) at Blocks/Districts level and 75 District Vidyut Abhiyantas (DVAs) atDistrict level. The GVAs are responsible for monitoring of the villages and uploading theinfrastructure data and photographs on "GARV App" (mobile phone application) ondaily basis.

Further GARV App has been updated with new features to provide householdelectrification data in respect of implementation of rural electrification in around sixlakh villages of the country and to enhance the participation of public it also providescitizen engagement window 'SAMVAD' for providing their feedback and suggestions whichshall automatically alert the concerned officials of DISCOMs through SMS & Email ontheir dashboard.

Financial Performance of RECPDCL during financial year 2016-17

During the financial year 2016-17 RECPDCL's total revenue was ' 191.57 crore and theProfit After Tax was ' 40.33 crore which are 26.42% and 11.15% respectively more ascompared to the previous year's revenue of ' 151.54 crore and Profit After Tax of ' 36.17crore. As on March 312017 the Net Worth of the Company has increased by 34.33% to '157.84 Crore as compared to ' 117.50 crore in the previous year. For the financial year2016-17 the Board of Directors of the company have recommended a dividend of ' 2421/-(Rupees Two Thousand Four Hundred Twenty One only) per equity share (on the face value of' 10/- each) subject to approval of Shareholders in the ensuing Annual General Meeting.

21.2 REC Transmission Projects Company Limited

During the financial year 2016-17 the Ministry of Power Government of India hasallocated the following Inter-State Transmission projects with aggregate estimated cost ofapprox. ' 2237 crore to RECTPCL to act as the Bid Process Coordinator (BPC) for selectionof developer for:

i. New WR-NR 765 kV Inter-regional corridor

ii. Eastern Region Strengthening Scheme- XXI (ERSS-XXI)

In addition to the above Government of Uttar Pradesh has also allocated oneIntra-State Transmission project with aggregate estimated cost of ' 2570 crore to RECTPCLfor selection of developer for Evacuation of Power from 3X660 MW Ghatampur Thermal PowerProject.

For selection of developer for each of the transmission project a two stage Biddingprocess featuring separate Request for Qualification (RfQ) and Request for Proposal (RfP)is adopted in accordance with Tariff Based Competitive Bidding guidelines of Ministry ofPower Government of India.The bidding process of following transmission projectsallocated during the financial year 2015-16 has been completed and the respective projectSPV has been transferred to the successful bidder during the financial year 2016-17:

Sl. No. Name of Transmission project Name of project Specific SPV Name of Selected Bidder Date of Transfer of project specific SPV
1. NER System Strengthening Scheme- II (Part-B) & V NER II Transmission Limited Sterlite Grid 4 Limited March 31 2017
2. Transmission System Strengthening in WR associated with Khargone TPP (1320 MW) Khargone Transmission Limited Sterlite Grid 4 Limited August 22 2016
3. "System Strengthening Scheme in Northern Region (NRSS-XXXVI)" along with LILO of Sikar- Neemrana 400kV D/C line at Babai (RRVPNL). NRSS XXXVI Transmission Limited Essel Infraprojects Limited August 22 2016
4. Immediate evacuation for North Karanpura (3x660 MW) generation project of NTPC alongwith creation of 400/220 kV sub-station at Dhanbad - Proposal of JUSNL (ERSS-XIX) North Karanpura Transco Limited Adani Transmission Limited July 8 2016

Further during the financial year 2016-17 the office of Registrar of Companies (RoC)NCT of Delhi and Haryana has approved the applications for striking off the name ofNellore Transmission Limited and Baira Siul Sarna Transmission Limited from the Registerof Companies u/s 560 of Companies Act 1956 and has issued certificates for dissolutiondated May 25 2016 and July 16 2016 respectively.

Further as on March 31 2017 the bidding process for selection of developer forfollowing transmission projects was under progress:

Sl. No. Name of Transmission project Name of project Specific SPV Date of Incorporation of spv Expected completion time of bidding process
1. Transmission system for Phase-I Generation Projects in Arunachal Pradesh Dinchang Transmission Limited December 2 2015

Financial Year 2017-18

2. Evacuation of Power from 3X660 MW Ghatampur Thermal Power Project Ghatampur Transmission Limited December 2 2016
3. Eastern Region Strengthening Scheme -XXI (ERSS-XXI) ERSS XXI Transmission Limited January 11 2017
4. New WR- NR 765 kV Inter-regional corridor WR-NR Power Transmission Limited January 12 2017

During the financial year 2016-17 RECTPCL has also bagged assignments relating toProject Management Consultancy (PMC) Third Party Inspection Bid Process ManagementProject Management and Implementation Agency from HPCL Vishakhapatnam; and from the stateof Goa Mizoram and J&K.

Financial Performance of RECTPCL during financial year 2016-17

REC Transmission Projects Company Limited has generated an income of ' 52.38 croreduring the financial year 2016-17. The Profit Before Tax and Profit After Tax was ' 49.86crore and ' 34.46 crore respectively. The Net worth of RECTPCL has increased to ' 157.86crore as against ' 123.41 crore during the previous year. For the financial year 2016-17the Board of RECTPCL has recommended a dividend of ' 2760/- per equity share of ' 10/-each subject to approval of shareholders in the ensuing Annual General Meeting.

22. DETAILS OF JOINT VENTURE AND ASSOCIATE COMPANY

REC along with three other PSUs namely Power Grid Corporation of India Limited NTPCLimited and Power Finance Corporation Limited as partners has formed a Joint VentureCompany by the name Energy Efficiency Services Limited (EESL) on December 10 2009. REChas contributed ' 146.50 crore (being 31.71% of paid-up capital of EESL) upto March 312017.

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 Ministryof Power 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 2016-17 based on thestandalone audited financials the company's revenue from operations was ' 1150.86 crorecompared to the previous year revenue from operations of ' 774.89 crore. The Profit BeforeTax (PBT) was ' 81.65 crore as compared to ' 50.19 crore in the previous year. Furtherthe Profit After Tax (PAT) has also increased to ' 51.86 crore from ' 37.08 crore duringthe previous year.

23. CONSOLIDATED FINANCIAL STATEMENTS

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 (Audited) and Joint Venture Company i.e EESL(Un-audited) which shall be laid before the ensuing 48th Annual GeneralMeeting along with the Standalone Financial Statements of the Company. However thosewholly owned subsidiary companies which are incorporated by RECTPCL & are subsidiariesof REC in terms of provisions of Section 2(87) of Companies Act 2013 for the purpose ofsubsequent disposal have not been consolidated 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 www.recindia.nic.in . Further these documents will be kept for inspection byany member or trustee of the holder of any debentures at the Registered Office of theCompany. The Company will also make available copy thereof upon specific request by anymember of the Company interested in obtaining the same.

24. DIRECTORS AND Key MANAGERIAL pERSONNEL

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 under the Companies Act 2013) for attending the meetings ofBoard and Committees thereof. As per the norms of Government of India the GovernmentNominee Director is not entitled to receive any remuneration /sitting fee from theCompany. The details of remuneration/sitting fees paid to Directors are given in CorporateGovernance Report annexed to this report.

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 2016-17 Shri Rajeev Sharma (DIN: 00973413) Chairman &Managing Director was relieved from services of the Company w.e.f October 12016 onrelinquishment of charge and Shri Bhagwati Prasad Pandey (DIN: 01393312) SpecialSecretary Ministry of Power was assigned additional charge of Chairman & ManagingDirector initially for a period of three months from October 1 2016 to December 31 2016vide order No.46/8/2011-RE dated September 30 2016 issued by Ministry of Power.Subsequently his tenure was extended till January 4 2017. Thereafter Dr. P V RameshIAS (AP: 1985) took over the charge of Chairman & Managing Director w.e.f. January 52017 in pursuance of Communications No. 36/02/2016-EO (SM-1) dated December 5 2016issued by Department of Personnel and Training Ministry of Personnel Public Grievancesand Pensions Government of India.

Further Smt. Asha Swarup was appointed as Part time Non Official Independent Directoron the Board of Company for a period of 3 years from the date of notification of herappointment or till further orders whichever is earlier vide Order No.46/2/2010-RE Vol.II (Part- IV) dated February 8 2017 by the Ministry of Power.

In terms of order dated May 17 2012 issued by the Ministry of Power Government ofIndia Shri Ajeet Kumar Agarwal has assumed charge as Director (Finance) of the Companywith effect from August 1 2012 and his tenure of five years was liable to expire on July31 2017. Ministry of Power vide its order dated July 19 2017 has extended his tenure asDirector (Finance) of the Company from August 12017 to May 312020 i.e. the date of hissuperannuation or until further orders whichever is earlier.

In line with the statutory requirements all the Independent Directors had given therequisite declaration that they meet the criteria of independence and none of theDirectors are related inter-se.

The Ministry of Corporate Affairs (MCA) has exempted Government Companies from therequirement of obtaining approval of shareholders for appointment of Whole-timeDirector(s) and Independent Director(s) vide Notifications dated June 5 2015 and July 52017 respectively. Accordingly the appointment of Functional and Independent Directorson the Board of the Company are not required to be approved by the shareholders.

As per the provisions of the Companies Act 2013 and in terms of provisions of Article91 (iv) of Articles of Association of the Company Dr. Arun Kumar Verma (DIN: 02190047)Government Nominee Director shall retire by rotation at the 48th AnnualGeneral Meeting and being eligible offers himself for re-appointment. The Board ofDirectors recommends his re-appointment as a Director. His brief resume is annexed to theNotice of the AGM.

25. EVALUATION OF BOARD OF DIRECTORS/INDEPENDENT DIRECTORS

As per the statutory provisions a listed company is required to disclose in itsBoard'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.

However Ministry of Corporate Affairs vide its notification dated June 5 2015 hasinter-alia exempted the Government Companies from the above requirement in case theDirectors are evaluated by the Ministry or Department of the Central Government which isadministratively in charge of the Company as per its own evaluation methodology.Accordingly REC being a Government company is exempted in terms of above notification asthe evaluation of performance of all the members of the Board including IndependentDirectors is undertaken by administrative ministry i.e. Ministry of Power Government ofIndia.

Further MCA vide Notification dated July 5 2017 prescribed that the provisionsrelating to review of performance of Independent Directors and evaluation mechanismprescribed in Schedule IV of the Companies Act 2013 is also not applicable to GovernmentCompanies.

26. MOURATING AND AWARDS

The performance of your Company in terms of MoU signed with the Ministry of PowerGovernment of India for the financial year 2015-16 has been rated as"Excellent". This is the 23rd 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 2016-17 also the Company is poised to receive"Excellent" rating.

During the year your Company has received "Best Power Financing Company"award in CBIP Awards 2017; won Gold Trophy for "SCOPE Meritorious award for BestPublic Sector Financing Institution or Insurance Company" for the year 2014-15 andalso received "SCOPE Award for Excellence and Outstanding Contribution to the PublicSector Management" for the year 2014-15 from Hon'ble President of India in April2017.

27. DIRECTORS' RESPONSIBILITY STATEMENT

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 2017 theapplicable Accounting Standards had been followed and

no material departures had been made from the same;

(ii) such accounting policies had 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 had been taken for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;

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

(v) internal financial controls had been laid to be followed by the Company and suchinternal financial controls are adequate and operating effectively; and

(vi) proper systems had been devised to ensure compliance with the provisions of allapplicable laws and such systems are adequate and operating effectively.

28. ‘THINK GREEN GO GREEN' INITIATIVE

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 share holderswhose 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. The Company has also appointed an IT Management consultant fordigitalizing its operations so as to create a paper-less office environment by reducingthe consumption of paper.

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' Reportetc.

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.

29. SWACHH BHARAT ABHIYAN

REC has organized various cleanliness programmes i.e. "Swachh BharatPakhwada" from May 1 2016 to May 15 2016; "Swachh Bharat Mission"(Swachta Pakhwada) from June 16 2016 to June 30 2016 & "Swachhta Abhiyan"(National Cleanliness Campaign) during September 26 2016 to October 2 2016 at Corporateoffice of the Company. During the cleanliness programs banners & posters were fixedin and around office premises to spread awareness among employees and general public. Allemployees of REC participated with great enthusiasm and zeal & undertook specialcleanliness drive of their respective office premises toilets stairs lifts & othersurrounding areas. Old and unwanted records have been weeded out as per Record RetentionSchedule. In this process aprox. 4000 kg waste official papers magazines periodicalsdraft reports etc. were disposed off. Printing of logo of "Swachh BharatMission" on all file covers envelops and letter heads of the Company still continuesin REC for creating awareness about cleanliness. Cleanliness is continuous process and itwill continue in REC.

30. RIGHT TO INFORMATION ACT 2005

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 & appeals and furnishingthe information & disposal of appeals. RTI Handbook both in English and Hindi hasbeen placed on REC website.

The status of RTI applications and appeals during the financial year 2016-17 is asfollows:

Sl. No. particulars Nos.
1. Applications received 298
2. Applications disposed off 288
3. Applications disposed off subsequently 10
4. Appeals received by First Appellate Authority REC 26
5. Appeals disposed off by First Appellate Authority REC 26
6. Second Appeal notice received from Central Information Commission (CIC) 12
7. Second Appeal disposed off by Central Information Commission (CIC) 12

31. reporting UNDER public procurement policy FOR MICRO & SMALL ENTERpRISES (MSEs)ORDER 2012.

To encourage participation by 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:http://www.recindia.nic.in/uploads/files/Public ProcurementPolicv.pdf REC being financial institution is not executing any project. Hence onlyprocurement of office equipment like computers printers and petty purchasei.e.consumables & stationery items etc. from market are being made. During thefinancial year 2016-17 procurement amounting to ' 1.44 crore were made from MSEs.

32. DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKpLACE (pREVENTIONpROHIBITION AND REDRESSAL) ACT 2013.

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) relating to 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 members. Anti-sexual harassment stanceof the Company is also outlined in REC (Conduct Discipline and Appeal) Rules. During thefinancial year 2016-17 no complaint of sexual harassment was received in the Company.

33. EXTRACT OF ANNUAL RETURN

Pursuant to Section 92(3) of Companies Act 2013 read with Rule 12(1) of Companies(Management and Administration) Rules 2014 an extract of Annual Return in Form MGT-9 isannexed to this report.

34. pARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED pARTIES

In compliance of the provisions of the Companies Act 2013 the particulars ofcontracts or arrangements entered into by the Company with its related parties aredisclosed in Form AOC-2 annexed to this report.

35. AUDITORS

STATUTORY AUDITORS

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 2016-17 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 2017.

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 A.R. & Co.Chartered Accountants (Firm Reg. No.: 002744C) New Delhi and M/s G.S. Mathur & Co.Chartered Accountants (Firm Reg. No.: 008744N) as the Statutory Auditors of the Companyfor the financial year 2017-18 and the Statutory Auditors have also accepted theirappointment. Approval of the Members of the Company will be obtained in the ensuing AnnualGeneral Meeting to authorize the Board of Directors of the Company to fix theremuneration of Auditors for the financial year 2017-18.

SECRETARIAL AUDITORS

M/s Sanjay Grover & Associates Practicing Company Secretaries (Certificate ofPractice No.3850) New Delhi were appointed as Secretarial Auditors of the Company forcarrying out Secretarial Audit for the financial year 2016-17. In terms of Section 204 ofthe Companies Act 2013 and Rules made thereunder they have issued Secretarial AuditReport for the financial year 2016-17 and the same is annexed to this Report.

35.1 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 observation and Management Reply to theobservation of the Statutory Auditors is 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 controls system except (i) 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 (ii) strengthening of procedures for monitoring of utilization of funds disbursed to the borrowers (iii) procedure for processing of the claims of travel agent over financial reporting. 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 2016-17. However they have one observation relating to a Related PartyTransaction. The Management Reply to the observation is submitted as under:

Observation of Secretarial Auditors Management's Reply
The Company has complied with the provisions of the Act Rules and Regulations to the extent applicable except that for one related party transaction entered in ordinary course of business and on arm's During the financial year 2016-17 REC appointed SBICAP Securities Limited a Related Party as arranger for raising money through issue of bonds in the ordinary course of its business & on arm's length basis through competitive bidding. As per the requirement of Companies Act 2013 and Rules made thereunder no approval of Audit Committee or Board of Directors was required to be obtained for such a transaction. However as per SEBI (LODR) Regulations 2015 prior approval of Audit Committee is required for all Related Party Transactions.
length as per the explanation given by the Company post facto approval of the Audit Committee was obtained which is not in line with SEBI (LODR) Regulations 2015. Since the appointment of SBICAP Securities Limited as arranger was done on competitive bidding basis it was difficult to obtain prior approval of Audit Committee in this regard. Further the approval of Audit Committee was obtained as soon as SBICAP Securities Limited was appointed. However to avoid such situation in future omnibus approval of Audit Committee has been obtained for all such Related Party Transactions in terms of SEBI (LODR) Regulations 2015.

36. COMMENTS OF C&AG OF INDIA

The Comptroller and Auditor General (C&AG) of India vide letter dated August 32017 has given 'Nil' Comments on the Audited

Financial Statements of the Company for the year ended March 312017 under Section 143(6) (a) of the Companies Act 2013.

The Comments of C&AG for the financial year 2016-17 have been placed along withthe report of Statutory Auditors of the

Company elsewhere in this Annual Report.

37. DEBENTURE TRUSTEES

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 the Company from time to time isannexed to this report.

38. STATUTORY DISCLOSURES

a) There was no change in the nature of business of the Company during the financialyear 2016-17.

b) The Company has not accepted any public deposits during the financial year 2016-17.

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 AnalysisReport' annexed to this report.

e) Information on composition terms of reference and number of meetings of the Board& its Committees held during the year establishment of vigil mechanism/ whistleblower policy and web-links for familiarization/ training policy of Directors Policy onMateriality of Related Party Transactions and Dealing with Related Party Transactions andPolicy for determining Material Subsidiaries Compensation to Key Managerial PersonnelSitting fees to Independent Directorsetc. have been provided in the Report on CorporateGovernance which forms part of the Annual Report.

f) 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.

g) Since the provisions of Section 197 of the Companies Act 2013 and Rules madethereunder related to Managerial Remuneration are not applicable to GovernmentCompanies no disclosure is required to be made.

h) Being a Government Company REC is exempt from the statutory provisions relating toperformance evaluation of Directors and disclosure in respect of evaluation mechanism inthe Board's Report of the Company.

i) 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 2017and the date of this report.

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

39. Status OF CONSTRUCTION OF REC

corporate office building at gurugram

The construction of Corporate Office building at Gurugram Haryana was started inApril 2015 and the RCC works upto 2nd floor (including three basements) havebeen completed. Further work relating to RCC at 3rd floor installation ofHVAC duct & fire fighting pipe etc. are being executed simultaneously.

The project has been awarded by GRIHA Council for exemplary demonstration of 'PassiveArchitecture Design' under GRIHA rating during 8th GRIHA Summit in March 2017.Further the building has unique features such as composite structure to support roof topsolar pergola provision of radiant cooling slabs seamless white fair finish columns withuse of imported shuttering etc. & adoption of construction technology at par withdeveloped countries.

40. STATUTORY AND OTHER INFORMATION REQUIREMENTS

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
Auditor's Certificate on Corporate Governance III
Business Responsibility Report IV
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

41. ACKNOWLEDGEMENTS

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 Sanjay Grover & 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
p V Ramesh
Chairman & Managing Director
Place: New Delhi (DIN: 02836069)
Date : August 212017

ANNEXURE-IV TO BOARD'S REPORT

BUSINESS RESPONSIBILITY REPORT

Section A : General Information about the Company

1. Corporate Identification Number (CIN) of the Company: L40101DL1969GOI005095

2. Name of the Company: Rural Electrification Corporation Limited (REC)

3. Registered address: Core-4 SCOPE Complex 7 Lodhi Road New Delhi-110003 India

4. Website: www.recindia.nic.in

5. E-mail id: complianceofficer@recl.in

6. Financial year reported: 2016-17

7. Sector(s) that the Company is engaged in (industrial activity code-wise)

Group: 649 Class: 6492 Sub class: 64920: Other Financial service activities - OtherCredit Granting

Description : This class includes financial service activities primarily concerned withmaking loans by institutions not involved in monetary intermediation (such as venturecapital companies industrial banks investment clubs) where the granting of credit cantake a variety of forms such as loans mortgages credit cards etc.

The Company is a Non-Banking Financial Company (NBFC) categorized as InfrastructureFinance Company (IFC) with the Reserve Bank of India and the Company is engaged in thebusiness of providing finance for power sector.

8. List three key products/services that the Company manufactures/provides (as inbalance sheet)

REC is engaged in financing projects / schemes of power generation transmissiondistribution rural electrification system improvement renovation and modernization ofpower plants in both public and private sectors. Its key product includes Term LoansMedium Term Loans Short Terms Loans etc. REC is designated as Nodal Agency forimplementation of "Deendayal Upadhyaya Gram Jyoti Yojana (DDUGJY) a flagshipprogramme of Government of India supplementing overall rural development and facilitatingtowards "24x7 Power For All" in the country. Further REC is also a Nodal Agencyfor National Electricity Fund (NEF) an Interest Subsidy Scheme to provide interestsubsidy on loans disbursed to the State Power Utilities Distribution Companies (DISCOMs)- both in public and private sector to improve the infrastructure in distribution sector.Further REC has now been appointed as Nodal Agency for monitoring the implementation ofOutage Management System and 11 kV Rural Feeder Monitoring System.

9. Total number of locations where business activity is undertaken by the Company

i. Number of International Locations (Provide details of major five): None

ii. Number of National Locations: REC has offices at 22 National Locations viz. NewDelhi Kolkata Chennai Jaipur Panchkula Shimla Jammu Lucknow Bhopal MumbaiVadodara Bengaluru Thiruvananthapuram Bhubaneswar Hyderabad (Regional Office as wellas Central Institute for Rural Electrification {CIRE}) Shillong Guwahati RanchiDehradun Patna Raipur and Varanasi. Further the Company is in the process of setting upnew offices at Vijaywada Itanagar and Imphal.

10. Markets served by the Company - Local/State/National/International:

REC serves the Indian markets only and its business extends throughout India.

Section B : Financial Details of the Company

1. Paid up Capital ('): 1974.92 crore

2. Total Turnover ('): 24095.35 crore

3. Total Profit after Tax ('): 6245.76 crore

4. Total spending on Corporate Social Responsibility (CSR) as percentage of profitafter tax (%):

During the financial year 2016-17 REC disbursed an amount of ' 69.80 crore towards CSRactivities as against the CSR Budget of ' 146.57 crore calculated @ 2% of the average netprofits of the Company during the three immediately preceding financial years.

The disbursement under the sanctioned projects is linked with achievement ofpre-defined milestones as per sanction terms. Due to long gestation period of CSRprojects the disbursement under these projects is normally spread over a period of two-three years resulting in shortfall in CSR spending during the financial year 2016-17. Theundisbursed amount will be released during the financial year 2017-18.

5. List of activities in which expenditure in 4 above has been incurred:

The major areas on which the above expenditure has been incurred includes:

a) Health care sanitation safe drinking water etc.;

b) Education Vocation skills and Livelihood enhancement projects etc.;

c) Setting up old age homes and such other facilities for senior citizens etc.;

d) Environmental sustainability; and

e) Rural Development Projects.

Section C : Other Details

1. Does the Company have any Subsidiary Company/ Companies?

Yes. The Company has following Wholly Owned Subsidiary Companies as on March 31 2017:

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

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

Further as on March 31 2017 RECTPCL was having the following project specific SpecialPurpose Vehicles (SPVs) as Wholly Owned Subsidiary Companies:

i. Dinchang Transmission Limited (CIN: U40300DL2015GOI288066)

ii. Ghatampur Transmission Limited (CIN: U40300DL2016GOI308788)

iii. ERSS XXI Transmission Limited (CIN: U40300DL2017GOI310436)

iv. WR-NR Power Transmission Limited (CIN: U40100DL2017GOI310478)

2. Do the Subsidiary Company/Companies participate in the BR Initiatives of the parentcompany? If yes then indicate the number of such subsidiary company(s).

Yes REC encourages all its subsidiary companies to participate in its BusinessResponsibility (BR) initiatives on a wide range of topics. During the financial year2016-17 two subsidiary companies viz. RECPDCL and RECTPCL participated in the BRinitiatives of REC as detailed below:-

a) RECTPCL was engaged for development of an Outage Management System named "UrjaMitra" for disseminating power outages information to distribution consumers acrossIndia through SMS/email/push notifications. Urja Mitra also provides Pan-India integratedMobile Application on Android and iOS platforms to enable citizen to access specific Poweroutages information in their area.

b) RECPDCL was engaged for day to day monitoring of progress of rural electrification(RE) works and surveillance quality checks on electrification of balance 18452un-electrified (UE) villages as part of Ministry of Power's Mission to completeelectrification of balance UE villages within a targeted deadline. In this regard aMobile App "GARV" (Grameen Vidyutikaran) has been developed for monitoring theprogress of electrification in 18452 villages in line with milestones. The mobile app isaccessible for viewing to all stakeholders including general public at large. It servesboth as a monitoring tool as well as promotes transparency in progress of electrificationworks.

In addition to village electrification the emphasis has now been laid on householdelectrification. To achieve this updated GARV App has been launched in December 2016 formonitoring Household electrification in all 5.97 Lakh villages. Further in the portal afeature named SAMVAD facilitating general public to raise their queries and interact withDISCOM officials establishing transparency and accountability has been provided toempower the common man.

c) REC also engaged its subsidiary companies viz. RECTPCL and RECPDCL as implementingagencies for carrying out various CSR activities.

3. Do any other entity/entities (e.g. suppliers distributors etc.) that the Companydoes business with participate in the BR initiatives of the Company? If yes then indicatethe percentage of such entity/entities? [Less than 30% 30-60% More than 60%]

REC strives to follow responsible business practices with increased focus on economicenvironmental and social concerns in order to achieve the twin-objectives of growth andsustainability for all its stakeholders. In furtherance of the same REC encourages itsbusiness partners to participate in its BR initiatives. REC provides finance atconcessional rates for Clean & Renewable Energy projects. Further the Company alsoengages its Joint Venture Company i.e. Energy Efficiency Services Limited (EESL) in takingup sustainability projects under its CSR initiatives.

Section D : BR Information

1. Details of Director/Directors responsible for BR

a) Details of the Director/Directors responsible for implementation of the BRpolicy/policies. DIN:03464342

Name: Shri Sanjeev Kumar Gupta Designation: Director (Technical)

b) Details of the BR Head

Sl. No. particulars Details
1. DIN (if applicable) 03464342
2. Name Sanjeev Kumar Gupta
3. Designation Director (Technical)
4. Telephone number 011- 4309 1522
5. e-mail id skgupta@recl.in

2. principle-wise (as per NVGs) BR policy/policies (Reply in Y/N)

In line with Regulation 34(2)(f) of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 read with Circular dated November 4 2015 SEBI hasstipulated that Top 100 listed companies are required to formulate a structured businessresponsibility report based on the following nine principles describing the initiativestaken by them from an environmental social and governance perspective:-

P1 - Businesses should conduct and govern themselves with Ethics Transparency andAccountability.

P2 - Businesses should provide goods and services that are safe and contribute tosustainability throughout their life cycle.

P3 - Businesses should promote the well-being of all employees.

P4 - Businesses should respect the interests of and be responsive towards allstakeholders especially those who are disadvantaged vulnerable and marginalized.

P5 - Businesses should respect and promote human rights.

P6 - Businesses should respect protect and make efforts to restore the environment.

P7 - Businesses when engaged in influencing public and regulatory policy should do soin a responsible manner.

P8 - Businesses should support inclusive growth and equitable development.

P9 - Businesses should engage with and provide value to their customers and consumersin a responsible manner.

(a) Details of compliance (Reply in Y/N)

Sl. No. Questions p1 p2 p3 p4 p5 p6 p7 p8 p9
1. Do you have policy/policies for... Y Y Y Y Y Y Y Y Y
2. Has the policy being formulated in consultation with the relevant stakeholders Y Y Y Y Y Y Y Y Y
3. Does the policy conform to any national / international standards? If yes specify? Y Y Y Y Y Y Y Y Y
4. Has the policy being approved by the Board? If yes has it been signed by MD / owner / CEO / appropriate Board Director? Y Y Y Y Y Y Y Y Y
5. Does the company have a specified committee of the Board/ Director / Official to oversee the implementation of the policy? Y Y Y Y Y Y Y Y Y
6. Indicate the link for the policy to be viewed online? Y Y Y Y Y Y Y Y Y
7. Has the policy been formally communicated to all relevant internal and external stakeholders? Y Y Y Y Y Y Y Y Y
8. Does the Company have in-house structure to implement the policy / policies? Y Y Y Y Y Y Y Y Y
9. Does the Company have a grievance redressal mechanism related to the policy / policies to address stakeholders' grievances related to the policy / policies? Y Y Y Y Y Y Y Y Y
10. Has the Company carried out independent audit / evaluation of the working of this policy by an internal or external agency? Y Y Y Y Y Y Y Y Y

The relevant explanation/information/links are mentioned in the Annexure to thisReport.

2a. If answer to Sl. No. 1 against any principle is ‘No' please explain why:(Tick up to 2 options)

Not Applicable.

3. Governance related to BR

• Indicate the frequency with which the Board of Directors Committee of the Boardor CEO to assess the performance of the Company. Within 3 months 3-6 months AnnuallyMore than 1 year.

On annual basis.

• Does the Company publish a BR or a Sustainability Report? What is the hyperlinkfor viewing this report? How frequently it is published?

Yes. REC publishes the Business Responsibility Report annually as part of its AnnualReport. The hyperlink for viewing the Annual Report for the financial year 2016-17 ishttp://www. recindia.nic.in/uploads/files/ar2016-17.pdf.

Section E: principle-wise performance

principle 1- ETHICS TRANSpARENCY & Accountability

1. Does the policy relating to ethics bribery and corruption cover only the Company?Yes/No. Does it extend to the Group/ Joint Ventures/Suppliers/Contractors/ NGOs/ Others?

Yes the policy relating to ethics bribery and corruption covers the employees of theCompany as well as shareholders consultants vendors lenders borrowers contractorsoutside agencies doing business with REC employees of such agencies and/or any otherparties having business relationship with REC.

The Company has always laid emphasis on the cardinal principles of fairness ethics andtransparency in dealing with its stakeholders. In this direction the Company has put inplace a "Policy for Prevention of Fraud" which set forth obligation on part ofevery employee of the Company for prevention detection and reporting of any act of fraudbribery or corruption.

Further the Company has also established a 'Vigil Mechanism' for Directors andemployees to report their genuine concerns or grievances about unethical behavior actualor suspected fraud or violation of the Company's Code of Business Conduct or Ethics. As anintegral part of such Vigil Mechanism the Whistle Blower Policy of REC has beenformulated with a view to empower the Directors and employees of REC and / or itssubsidiary companies to detect and report any improper activity within the Company.Further the Company has formulated a 'Policy on Materiality of Related Party Transactionsand Dealing with Related Party Transactions' which prescribes adequate procedures anddisclosures to be made before entering into transactions with such parties.

REC has also framed Conduct Discipline and Appeal (CDA) Rules which define code ofconduct for employees and the acts of bribery corruption etc. are included therein asmisconducts on the part of employees. Central Vigilance Commission's (CVC) guidelines/instructions etc. are also followed in this regard. The above policies rulesguidelines/instructions etc. are also applicable to the subsidiary companies of REC.Further other stakeholders are also required to conform to principles of fairness ethicsand transparency in their dealings with REC.

Further REC has adopted "Code of Business Conduct & Ethics for Board Membersand Senior Management" which captures the behavioral and ethical standards. Furtherin compliance of guidelines on Fair Practices Code of Reserve Bank of India (RBI) REC hasalso developed the Fair Practices Code (FPC) for its lending operations which intends toprovide assurance to all the borrowers regarding the Company's commitment to fair dealingand transparency in its business transactions.

2. How many stakeholder complaints have been received in the past financial year andwhat percentage was satisfactorily resolved by the management? If so provide detailsthereof in about 50 words or so.

During the financial year 2016-17 the Company did not receive any complaint under theWhistle Blower Policy and Fair Practices Code. Further 9 general complaints (other thananonymous/pseudonymous complaints) were received out of which

3 complaints (i.e. 33%) were resolved during the financial year 2016-17 and theremaining complaints are under review. However no complaint was directly related toethics bribery and corruption issues.

Further the Company received 943 and 3256 complaints from Equity Shareholders andBondholders (Listed/Un-listed Debt Securities) respectively. All the complaints of theEquity Shareholders and Bondholders received during the financial year 2016-17 have beensatisfactorily resolved as on the date of this Report.

Principle 2- SUSTAINABILITY IN LIFE-CYCLE OF PRODUCT

1. List up to 3 of your products or services whose design has incorporated social orenvironmental concerns risks and/ or opportunities.

The main business of REC is to provide loan assistance to various State PowerUtilities Private Sector Project Developers Central Power Sector Utilities and StateGovernments for investment in Power Generation Transmission & Distribution projectsand other system improvement schemes/initiatives. The Company endeavors to incorporatesocial and environmental concerns while conducting appraisals of the projects for itslending operations. The Company provides concessional interest rate loans and otherfinancial support for providing access to electricity to all rural households under DDUGJYinitiative of Government of India. Further there is a policy for providing finance atconcessional rates for development of North-Eastern states.

REC has also taken up the initiative of monitoring electrification of remaining 18452un-electrified villages of the country within a targeted deadline and a Mobile App"GARV" has been developed to provide real-time updates on electrification statusof each village. Further GARV was updated with new features to provide real time data inrespect of implementation of household electrification in 5.97 lakh villages of thecountry and to enhance the participation of public it also provides a citizen engagementwindow 'SAMVAD' for providing their feedback and suggestions which shall automaticallyalert the concerned officials of DISCOMs through SMS & Email on their dashboard.

Further in line with the enhanced focus of Government of India on promotion ofRenewable Energy the Company has a defined policy framework for financing ofnon-conventional generation projects. In this regard the Company has revised theguidelines for private sector renewable energy projects by revision in the lending limits.Further with a view to address the environmental concerns the Company has reduced theinterest rates on financial assistance for Renewable Energy projects. Recently theCompany also raised money through issue of dollar denominated Green Bonds and the netproceeds from the same will be applied for financing of existing projects includingre-financing and new eligible Green Projects primarily in the area of solar windbiomass and hydropower energy as per Climate Bond Standards.

2. For each such product provide the following details in respect of resource use(energy water raw material etc.) per unit of product (optional):

Considering the nature of business of the Company and the products/initiatives referredto above the questions below have limited applicability to REC:

i. Reduction during sourcing/production/distribution achieved since the previous yearthroughout the value chain?

As our products are financial services the major resources consumed in the Company areelectricity and paper. During the year REC has taken a number of initiatives foroptimizing the consumption of resources such as reduction in consumption of paper byspreading awareness among employees managing paper procurement practices efficiently andimproved waste paper management. Further the Company has also appointed an IT Managementconsultant for digitalizing its operations so as to create a paper-less officeenvironment by reducing the consumption of paper.

ii. Reduction during usage by consumers (energy water) has been achieved since theprevious year?

As REC's products are financial services resource consumption like energy and water byconsumers was minimal and efforts were made to further reduce it.

3. Does the Company have procedures in place for sustainable sourcing (includingtransportation)? If yes what percentage of your inputs was sourced sustainably?

REC being a Financial Institution is relatively less resource intensive in terms ofmaterial inputs. Our major material requirements are office communications and IT relatedequipment. Despite the limited scope of our procurement needs we continue to takeinitiatives to ensure responsible sourcing in our supply chain. We have detailedprocurement guidelines prescribing the procedure for our major procurements.

4. Has the Company taken any steps to procure goods and services from local & smallproducers including communities surrounding their place of work? If yes what steps havebeen taken to improve their capacity and capability of local and small vendors?

REC being a Financial Institution is relatively less resource intensive in terms ofmaterial inputs. However we prefer locally available goods and services otherconsiderations being comparable. We are also following the Government of India'sdirectives issued from time to time in respect of reservation for Micro Small &Medium Enterprises in procurements.

5. Does the Company have a mechanism to recycle products and waste? If yes what is thepercentage of recycling of products and waste (separately as <5% 5-10% >10%).Also provide details thereof in about 50 words or so.

The Company being a Financial Institution has limited applicability of mechanism torecycle products and waste. However the Company has outsourced the mechanism to collectwaste papers from the premises of the Company for recycling of the same.

Further we are following e-Waste (Management and Handling) Rules 2011 as notified bythe Ministry of Environment & Forests (MoEF) Government of India with the specificaim of minimizing e-waste and responsible disposal of the entire quantum of e-waste onlythrough Government/Pollution Control Board registered e-waste recyclers.

principle 3 - EMpLOYEE WELL-BEING

1. please indicate the Total number of employees.

As on March 31 2017 the Company had 566 employees.

2. please indicate the Total number of employees hired on temporary/contractual/casualbasis.

During the financial year 2016-17 the Company had not hired any employees ontemporary/contractual/casual basis. However for housekeeping/cleaning/security worksetc. contractual labour is being engaged through third party contractors.

3. please indicate the Number of permanent women employees.

As on March 31 2017 the Company had 96 permanent women employees.

4. please indicate the Number of permanent employees with disabilities

As on March 31 2017 the Company had 14 permanent 'Divyang' employees withdisabilities.

5. Do you have an employee association that is recognized by management?

Yes REC has recognized the Union of its non-supervisory permanent employees and theAssociation of its Executives.

6. What percentage of your permanent employees is members of this recognized employeeassociation?

All regular employees of the Company are members of either Employees' Union orExecutives' Association.

7. please indicate the Number of complaints relating to child labour forced labourinvoluntary labour sexual harassment in the last financial year and pending as on theend of the financial year.

The Company has not received any complaints relating to child labour/forcedlabour/involuntary labour or sexual harassment in the last financial year and no complaintwas pending as on March 31 2017. Further the Company neither engages in any form ofchild labour/forced labour/involuntary labour nor adopts any discriminatory employmentpractices. The Company has a proper framework for dealing with instances relating tosexual harassment. In line with provisions of Sexual Harassment of Women at Workplace(Prevention Prohibition & Redressal) Act 2013 an 'Internal Complaints Committee'has been constituted in the Company for redressal of complaint(s) against sexualharassment of women employees. The Committee is headed by a senior woman official of theCompany and includes representative from an NGO as one of its members. Anti-sexualharassment stance of the Company is also outlined in REC (Conduct Discipline and Appeal)Rules.

8. What safety & skill up-gradation training was provided in the last year?

(a) permanent Employees

(b) permanent Women Employees

(c) Casual/Temporary/Contractual Employees

(d) Employees with Disabilities

Considering the nature of business of the Company the question has limited relevancein respect of safety. However the Company focusses on imparting continuous skillupgradation training to its employees.

Employee training and development is an essential element of the Company's strategy.REC has a proper training procedure and it does not differentiate on any parameters interms of identifying and imparting training to its employees. During the financial year2016-17 REC's 31.36% permanent employees 23.16% permanent women employees and 50%permanent employees with disabilities received technical skill up-gradation spiritualhealth and attitudinal training which works out to 589 training man days.

The Company also has a training institute viz. Central Institute for RuralElectrification (CIRE) in Hyderabad where various training programmes designed to meetthe changing skill requirements of its employees are conducted. These training programmesinclude orientation sessions for new employees programmes conducted by various functionalacademies leadership mentoring programmes and other management development programmes formid-level and senior executives.

Principle 4- STAKEHOLDER ENGAGEMENT

1. Has the company mapped its internal and external stakeholders?

Yes the Company has clearly mapped its internal and external stakeholders. Theinternal stakeholders include the employees of the Company. The external stakeholdersinclude the equity shareholders bondholders creditors State Governments StateElectricity Boards State Power Utilities and other Borrowers Reserve Bank of India SEBIand other regulatory bodies.

2. Out of the above has the Company identified the disadvantaged vulnerable &marginalized stakeholders?

Yes the Company has identified the disadvantaged vulnerable & marginalizedstakeholders. REC extends certain facilities to Micro Small & Medium Enterprises(MSME) registered with National Small Industries Corporation such as issue of tender setsfree of cost exemption from payment of earnest money waiver of security deposit uptomonetary limit for which unit is registered and opportunities for MSMEs owned by SC/ST.

Further REC has adopted employee oriented policies relating to staff and theirdependents in line with the general laws and regulations and sound ethical practicesfollowed nationally covering areas such as employee benefits commitment to equalopportunity in recruitment and prevention of sexual harassment at the workplace whichendeavors to provide an environment of care nurturing and opportunity to accomplishprofessional aspiration. The Company is also following the guidelines/ directions issuedby Government of India from time to time in respect of reservation for women and personsbelonging to SC/ST/OBC/PH categories in recruitment.

Under CSR initiatives the Company focused on providing job oriented skill developmenttraining & livelihood enhancement projects to youth including women providing healthcare sanitation & safe drinking water facility in rural area setting up old agehomes and such other facilities for senior citizens rural development projects andprojects for environmental sustainability etc.

3. are there any special initiatives taken by the Company to engage with thedisadvantaged vulnerable and marginalized stakeholders. If so provide details thereofin about 50 words or so.

Yes the Company regularly undertakes initiatives to engage with its internal andexternal disadvantaged vulnerable and marginalized stakeholders. REC also broadly followsthe principles of "The UN Global Compact" in the areas of human rights labourenvironment and anti-corruption which enjoy universal consensus. Further in order toencourage participation by MSMEs including Micro and Small Enterprises owned by SC/ST allthe directives mentioned in the Public Procurement Policy Order 2012 have been includedin REC Procurement Guidelines.

Each year the Company sets aside a percentage of its net profit for CSR andSustainability initiatives to fund and support socially beneficial projects withsustainability as a guiding principle to reach a wide spectrum of beneficiaries with aview to empower economically and socially backward communities elderly personsdifferently abled persons children youth etc.

Some of such initiatives undertaken during the financial year 2016-17 are as under:

1. Projects for safe drinking water facilities through RO water plant bore well etc.in rural areas mobile health care vans setting up / upgradation of infrastructure /facilities in select health care institutions distribution of assistive aids &appliances to persons with disabilities from weaker sections of societies etc.;

2. Projects for provision of water arrangement for sanitation in government schoolssetting up of mechanized sweeping collection and transportation of municipal solid wasteand contribution to Swachh Bharat Kosh to achieve the objective of Swachh Bharat Mission;

3. Projects for development of infrastructure in schools job-oriented skilldevelopment training for youth from economically weaker sections of society includingwomen setting up/establishing khadi spinning weaving and garment unit for creatingemployment;

4. Projects for installation of SPV plant in the campus of various educationalinstitutions solar micro grids in rural households and solar street lights in rural area;and

5. Programmes for farmer-centric integrated watershed development for improving rurallivelihoods. principle 5- pROMOTION OF Human RIGHTS

1. Does the policy of the Company on human rights cover only the Company or extend tothe Group/Joint Ventures/ Suppliers/Contractors/NGOs/Others?

REC is an active member of "The UN Global Compact" and follows its principlesin the areas of human rights labour the environment and anti-corruption which enjoyuniversal consensus and are derived from the Universal Declaration of Human RightsInternational Labour Organization's Declaration on Fundamental Principles and Rights atWork Rio Declaration on Environment & Development and United Nations ConventionAgainst Corruption.

Considering the nature of business of the Company human rights cover only the Companyand its subsidiary companies and to protect the human rights of employees REC has adoptedemployee oriented policies in line with the general laws and regulations and soundethical practices followed nationally covering areas such as employee benefits andprevention of sexual harassment at workplace which endeavor to provide an environment ofcare nurturing and opportunity to accomplish professional aspirations.

Further the Company believes that a sustainable organization rests on the foundationof ethics and respect for human rights and the Company ensures diversity of workplacethrough efforts to recruit develop and retain the most talented people from a diversecandidate pool. It upholds the principle that advancement is based on talent andperformance and there is a commitment to equal opportunity. The Company also emphasizes onsafe social environment human well-being including a safe natural environment. Itdiscourages conduct that implies granting or withholding favors or opportunities as abasis for making decisions affecting an individual in return for that individual'scompliance.

2. How many stakeholder complaints have been received in the past financial year andwhat percent was satisfactorily resolved by the management?

The Company did not receive any complaint in the area of human rights violations fromstakeholders.

Principle 6 - ENVIRONMENTAL PROTECTION

1. Does the policy related to principle 6 cover only the Company or extends to theGroup/Joint Ventures/Suppliers/ Contractors/NGOs/others.

The Company encourages its Group/Joint Ventures/Suppliers/Contractors/NGOs/others toparticipate in initiatives focused on environment protection and sustainability and assuch the policy of the Company pertaining to environmental protection is applicable toall its group companies as well. During the financial year 2016-17 REC has contributed '50 crore to Swachh Bharat Kosh an initiative of the Government of India to achieve theobjective of Clean India (Swachh Bharat) by the year 2019 the 150th year ofthe birth anniversary of Mahatma Gandhi through Swachh Bharat Mission. The fundscontributed to Swachh Bharat Kosh will be utilized for construction repair / renovationof toilets in rural areas urban areas and in government schools and other initiatives ofimproving sanitation and cleanliness including solid / liquid waste management.

Further RECTPCL a wholly owned subsidiary of REC also made contribution of ' 32.26lakh to Swachh Bharat Kosh under its CSR initiatives. Furthermore clients (borrowers) arealso required to be compliant to environment & social conditions in their operations.

2. Does the Company have strategies/initiatives to address global environmental issuessuch as climate change global warming etc.? Y/N. If yes please give hyperlink forwebpage etc.

REC being an NBFC-IFC is indirectly addressing the global environmental issues bylaying greater thrust on financing of Green Energy projects including Solar WindBiomass Co-generation Small Hydro projects etc. thereby enabling the country to movetowards non-carbon intensive energy generation.

Further REC has introduced special schemes of financing to promote Renewable Energyprojects across the country with a view to address global environmental issues such asclimate change global warming etc. The Company extends financial assistance to RenewableEnergy projects at lower interest rates as compared to conventional generation projects.During the financial year 2016-17 REC sanctioned loan assistance of ' 2089.77 crore to16 new Grid Connected Renewable Energy projects including Solar Wind and Small Hydroprojects. Further the disbursement on Renewable Energy projects during the financial year2016-17 amounted to ' 1617.68 crore which has surpassed the cumulative disbursement madeby REC against Renewable Energy projects in the previous five years.

Recently REC became the first Indian PSU to launch Green Bonds denominated in USDollars and the same were listed on the London Stock Exchange and Singapore ExchangeLimited. The proceeds from the same will be applied for financing of existing projectsincluding re-financing and new eligible Green Projects primarily covering in the area ofsolar wind biomass and hydropower energy as per Climate Bond Standards.

3. Does the Company identify and assess potential environmental risks? Y/N

The above question is not applicable to the Company as it is not a manufacturingcompany. However REC identifies and assesses potential environmental and social risks inall the infrastructure projects which are financed by REC. REC has been in the forefrontof integrating environmental risk assessment and mitigation into its overall investmentrisk assessment process. As part of the project appraisal environment related issues areidentified and detailed due diligence is carried out that includes site visits secondaryinformation collection and analysis review of applicable compliances and consents.

4. Does the Company have any project related to Clean Development Mechanism? If soprovide details thereof in about 50 words or so. Also if yes whether any environmentalcompliance report is filed?

The above question is not applicable directly to the Company as it is not amanufacturing company. However REC has diversified its business activities by introducinglower interest rates for promoting solar wind biomass and other renewable energyprojects across the country with a view to address global environmental issues such asclimate change global warming reduction of greenhouse gas emissions etc.

5. Has the Company undertaken any other initiatives on clean technology energyefficiency renewable energy etc. Y/N. If yes please give hyperlink for web page etc.

Yes. Under Decentralized Distributed Generation (DDG) scheme the Company is acting asan agency for channelizing the subsidy of Government of India for DDG projects fromconventional or renewable non-conventional sources such as Biomass Biogas Micro HydroWind Solar etc. Further REC grants loans at concessional interest rates for developmentof Renewable Energy projects. The offices of REC have also been made more energy-efficientby replacement of all conventional light fittings / CFL with energy efficient LED lights.Further during the financial year 2016-17 REC has sanctioned ' 140 crore to SouthernPower Distribution Company of Andhra Pradesh Limited (APSPDCL) for installation of 5000nos. of Solar Pumps in various districts of Andhra Pradesh. For more details of theCompany's related initiatives please refer to 'Report on Corporate Social ResponsibilityActivities' which forms part of this Annual Report.

6. Are the Emissions/Waste generated by the Company within the permissible limits givenby CPCB/SPCB for the financial year being reported?

The above question has limited relevance to the Company as it is not a manufacturingcompany. However the Company complies with applicable environmental regulations inrespect of the premises and operations.

7. Number of show cause/legal notices received from CpCB/SpCB which are pending (i.e.not resolved to satisfaction) as on end of financial year.

REC has not received any show cause/legal notices from CPCB/SPCB. principle 7-RESpONSIBLE pUBLIC pOLICY ADVOCACY

1. Is your Company a member of any trade and chamber or association? If yes name onlythose major ones that your business deals with.

Yes. REC is a member of World Energy Council Confederation of Indian Industry (CII)The Federation of Indian Chambers of Commerce and Industry (FICCI) Central Board ofIrrigation & Power (CBIP) Standing Conference of Public Enterprises (SCOPE) TheAssociated Chambers of Commerce and Industry of India (ASSOCHAM) Power HR Forum IndiaCFO Forum All India Management Association (AIMA) Institute of Public Enterprises (IPE)and Global Compact.

Further the senior officials of the Company contribute towards the formulation ofvarious policies relating to Power sector as part of various committees/working groupsconstituted by the Ministry of Power Government of India from time to time.

2. Have you advocated/lobbied through above associations for the advancement orimprovement of public good? Yes / No; if yes specify the broad areas (drop box: Governanceand administration Economic Reforms Inclusive Development policies Energy securityWater Food Security Sustainable Business principles Others)

The Company has raised issues relating to clean technology energy efficiency andrenewable energy at different platforms of the above associations from time to time.

Further during the year the Company has undertaken various CSR initiatives in thefields of skill development education environmental sustainability health careincluding for old age and persons with disabilities drinking water and sanitationfacilities including contribution to Swachh Bharat Kosh etc.

principle 8- INCLUSIVE GROWTH And Equitable DEVELOpMENT

1. Does the Company have specified programme/ initiatives/ projects in pursuit of thepolicy related to Principle 8? If yes details thereof.

The Company takes up programme/initiatives/projects in pursuit of the principle ofinclusive growth and equitable development in pursuance of its CSR and SustainabilityPolicy. Detailed information about the specified programmes and initiatives undertakenduring the financial year 2016-17 in pursuit of the Policy has been given in 'Report onCorporate Social Responsibility Activities' which forms part of this Annual Report.

2. Are the programme/ projects undertaken through in-house team/own foundation/external NGO/government structures/ any other organization?

The Company undertakes its CSR activities/projects through specialized agencies asspecified in the Company's CSR & Sustainability Policy which are either GovernmentOrganization/Semi-Government/PSU/Autonomous Organization/Section 8

Companies or registered trusts/societies preferably those having past work experiencewith Government/Semi-Government/ PSU/Autonomous Organizations for similar works.

3. Have you done any impact assessment of your initiative?

Yes under the CSR and Sustainability Policy there is a system of reviewing theCompany's CSR initiatives wherein progress of major initiatives is monitored and evaluatedalong with its impact.

4. What is your Company's direct contribution to community development projects- Amountin INR and the details of the projects undertaken?

The Board of Directors of the Company had approved a budget of ' 146.57 crore towardsCSR and Sustainable Development for the financial year 2016-17. Further CSR projectsamounting to ' 181.23 crore were sanctioned by REC in the fields of skill developmenteducation environmental sustainability health care facilities including for old age andpersons with disabilities drinking water and sanitation facilities including contributionto Swachh Bharat Kosh etc. and the disbursement in respect of these projects will bespread over a period of two-three years based on achievement of pre-defined milestones asper sanction terms.

5. Have you taken steps to ensure that this community development initiative issuccessfully adopted by the community? please explain in 50 words or so.

The Company under its CSR initiatives encourages the active engagement ofstakeholders such as the community Government Agency(ies)/Department(s) NGOs and otherlocal institutions in the project planning and implementation to facilitate developingand building community ownership while ensuring the sustainability of the programme.Feedback of the community is suitably incorporated in further developing such programme insame or other locations.

principle 9 - CUSTOMER Value

1. What percentage of customer complaints/consumer cases are pending as on the end offinancial year?

All the complaints received from various stakeholders in the reporting period have beensatisfactorily resolved. Further as on March 312017 there were three cases relating toinvestors in bonds pending in various consumer courts out of which one case has beenclosed since then.

2. Does the Company display product information on the product label over and abovewhat is mandated as per local laws? Yes/No/N.A./Remarks (additional information)

The above is not applicable as the Company is not a manufacturing company. Howeverthe Company ensures that adequate disclosures relating to its financial products andservices are made with respect to financing of projects. In this regard the Company hasextended the benefit of ERP directly to Borrower by developing an online "BorrowerPortal" to facilitate them in knowing status of loans and schemes on real time basis.

3. Is there any case filed by any stakeholder against the Company regarding unfairtrade practices irresponsible advertising and/or anti-competitive behavior during thelast five years and pending as on end of financial year? If so provide details thereofin about 50 words or so.

REC together with its subsidiary companies is committed to highest possible standardsof ethical practices and moral & legal business conduct. Further no case regardingunfair trade practices irresponsible advertising and/or anti-competitive behavior waspending as at the end of the financial year. However during the financial year 2014-15upon an information filed by an informant (name not disclosed) against RECPDCL a whollyowned subsidiary of REC the Competition Commission of India (CCI) had ordered aninvestigation against RECPDCL. CCI disposed off the case in favor of RECPDCL whileobserving that no contravention of the provisions of Section 4 of the CompetitionCommission Act 2002 has been made out against RECPDCL & others and the matter wasordered to be closed.

4. Did your Company carry out any consumer survey/ consumer satisfaction trends?

REC believes in providing best services to its customers. Meeting(s) with customers areorganized from time to time to understand their expectations and essentially to gauge ourcompetitiveness in the business. REC leverages its presence across the country to remainconsistently in touch with the customers through its Business units i.e. Regional/Stateoffices and mitigate their issues promptly. Feedbacks received from customers areimplemented to further enhance quality of service. The Senior Management meets on aregular basis to review the progress where all such matters are taken up and measuresnecessary to address the grievance(s) are decided.

Further in the past the Company through M/s Administrative Staff College of IndiaHyderabad has conducted Customer Satisfaction Survey of its esteemed customers across thecountry comprising Central and State Government Power Entities and Private Power Entities.The overall Customer Satisfaction Index (CSI) score of the Survey was 85.7 which byaverage American Customer Satisfaction Index (ACSI) is among the best in BankingServices.

ANNEXURE TO BUSINESS RESPONSIBILITY REPORT

P1 Sl. No. 3 - The Company has a Policy for Prevention of Fraud Code of BusinessConduct and Ethics and Whistle Blower Policy. The Policy for Prevention of Fraud isbroadly to provide a system for detection and prevention of fraud reporting of any fraudthat is detected or suspected and fair dealing of matters pertaining to fraud. Further asper the requirement of Corporate Governance under the Listing Regulations the Companyframed Code of Business Conduct and Ethics based on professional and ethical standardswhich the Company believes all its employees should adopt. Further as an integral part ofVigil Mechanism the Whistle Blower Policy of REC has been formulated with a view toempower the Directors and employees of REC and / or its subsidiary companies to detectand report their genuine concerns or grievances about unethical behavior actual orsuspected fraud or violation of Company's Code of Business Conduct and Ethics. Furtherthe Company has also formulated a 'Policy on Materiality of Related Party Transactions andDealing with Related Party Transactions' ("RPT Policy") which prescribesadequate procedures and disclosures to be made before entering into transactions with suchparties.

6 - The links of relevant Policies approved by the Board of Directors of the Companyare given below:-

Name of the Policy Weblink
Policy for Prevention of Fraud http://wwwrecindia.nic.in/uploads/files/prevention fraud policy pdf
Whistle Blower Policy http://wwwrecindia.nic.in/uploads/files/WhistleBlowerPolicypdf
Code of Business Conduct and Ethics http://wwwrecindia.nic.in/uploads/files/CodeBusinessConductEthics.pdf
Fair Practices Code http://wwwrecindia.nic.in/uploads/files/fairpracticecode.pdf
Policy on Related Party Transactions http://www.recindia.nic.in/uploads/files/RPT.pdf
Policy on Materiality of Subsidiaries http://www.recindia.nic.in/uploads/files/PolicyDeterminingMaterialSubsidiaries.pdf
Policy on Materiality of Events or Information http://www.recindia.nic.in/uploads/files/PolicyonMaterialityofEvents.pdf
for disclosure to Stock Exchanges
Dividend Distribution Policy http://www.recindia.nic.in/uploads/files/DividendDistributionPolicy.pdf

The other policies are internal documents and accessible only to employees of theorganization.

P2 Considering the nature of the Company's business this Principle has limitedapplicability to the Company. However the Company strives to follow sustainable businesspractices with focus on economic environmental and social concerns in order to achievethe twin-objectives of growth and sustainability. The Company complies with regulationsgoverning its products and services and has taken initiatives to promote inclusive growthand environmental sustainability.

Sl. No. 6 - The Corporate Social Responsibility and Sustainability Policy is availableon the website of the Company at the link: http://www.recindia.nic.in/uploads/files/CSRPolicy 24.01.2017.pdf

P3 Sl. No. 3 - In line with the general laws and regulations and sound ethicalpractices followed nationally the Company has adopted employee-oriented policies coveringareas such as employee benefits and prevention of sexual harassment at the workplace whichendeavors to provide an environment of care nurturing and opportunity to accomplishprofessional aspirations.

Sl. No. 6 - These policies can be viewed physically or online only by the employees ofthe organization.

P4 The principle enunciates the aspect of being responsive towards all stakeholdersincluding disadvantaged vulnerable & marginalized stakeholders and the Company doesnot have a specific policy in place for this. However the Company has set processes inplace to achieve these objectives. In addition the Company works towards inclusive growthin pursuance of its Corporate Social Responsibility & Sustainability Policy throughinterventions in areas like health care education vocation skills and livelihoodenhancement projects rural development projects etc.

Sl. No. 6 - The Corporate Social Responsibility and Sustainability Policy is availableon the website of the Company at the link: http://www.recindia.nic.in/uploads/files/CSRPolicy 24.01.2017.pdf

P5 Sl. No. 3 - The Code of Business Conduct & Ethics (Code) for Board Members andSenior Management which has been adopted by the Company addresses the requirements of thisprinciple. The Code emphasizes fair employment practices & diversity faircompetition prohibition of harassment & intimidation and safety at the workplace.

Sl. No. 6 - The Code of Business Conduct and Ethics is available on the website of theCompany at the link :http://www.recindia.nic.in/uploads/files/CodeBusinessConductEthics.pdf

P6 The aspects outlined under this Principle are not relevant to the nature of businessof the Company. The Company complies with applicable environmental regulations in respectof its premises and operations. Further the Company participates in initiatives towardsaddressing environmental issues. The Company also requires the borrowers of project loansto comply with the various national environmental standards/requirements.

P7 While there is no specific policy outlined for this principle the Company isworking with the State Governments and other organizations to promote initiatives in thefield of Skill Development Education Health Care Rural Development and EnvironmentalSustainability Projects.

P8 REC strives to ensure inclusive growth and equitable development in pursuance of itsCorporate Social Responsibility and Sustainability Policy. During the financial year2016-17 REC has taken various initiatives in this regard in the areas of preventivehealth care sanitation safe drinking water education vocation skills and livelihoodenhancement projects Environmental sustainability and Rural Development projects.

Sl. No. 6 - The Corporate Social Responsibility and Sustainability Policy is availableon the website of the Company at the link: http://www.recindia.nic.in/uploads/files/CSRPolicy 24.01.2017.pdf

P9 Sl. No. 3- The Company has Fair Practices Code and Grievance Redressal Form forLoans which conforms to the guidelines issued by Reserve Bank of India in this regard.

6- The above Code can be viewed online onhttp://www.recindia.nic.in/uploads/files/fairpracticecode.pdf All policies and processesare subject to audits and reviews done internally in the Company from time to time.

ANNEXURE-VIII TO BOARD'S REPORT

Form No. AOC-2

(Pursuant to clause (h) of sub-section (3) of Section 134 of the Companies Act 2013and Rule 8(2) of the Companies (Accounts) Rules 2014)

Disclosure of particulars of contracts/arrangements entered by Rural ElectrificationCorporation Limited with its related parties (as per Section 188(1) of the Companies Act2013)

1. Details of contracts or arrangements or transactions not at arm's length basis:

Name(s) of the related party and nature of relationship Nature of contracts/ arrangements/ transactions Duration of the contracts / arrangements / transactions Salient terms of the contracts or arrangements or transactions including the value if any Justification for entering into such contracts or arrangements or transactions Date(s) of approval by the Board Amount paid as advances if any Date on which the special resolution was passed in general meeting as required under first proviso to Section 188
REC Transmission Projects Company Limited Implementation of Outage Management System (Urja Mitra) an initiative of Ministry of Power Appointment of RECTPCL on nomination basis as implementing agency for Urja Mitra an initiative of Ministry of Power. In view of the experience of RECTPCL in handling large size projects and considering that it is in constant touch with State DISCOMs the contract were awarded to RECTPCL on nomination basis. May 27 2016 NIL
(RECTPCL) Wholly-Owned Subsidiary of REC Implementation of 11 kV Rural Feeder monitoring scheme 72 months (may be extended for further 6 months) Appointment of RECTPCL on nomination basis as implementing agency for 11 kV Rural Feeder monitoring scheme. Further the Project Management charges payable to RECTPCL shall be upto ? 15.21 crore in case the final project cost approved by Ministry of Power (MoP) is ? 233.03 crore and upto ? 20 crore in case the final project cost approved by MoP is ? 269.68 crore. September 212016 NIL
REC Power Distribution Company Limited (RECPDCL) Wholly-Owned Subsidiary of REC Installation of Solar Power Panels Installation of solar power panels in President's Estate Rashtrapati Bhawan New Delhi. In view of the experience of RECPDCL in implementation of the DDUGJY the contract was awarded to RECPDCL on nomination basis. June 27 2016 NIL
Construction of toilets Construction of 194 Nos. of toilets in 111 Nos. of Government Schools in select blocks of Ghazipur District Uttar Pradesh. In view of time bound completion schedule and experience of RECPDCL in the implementation of Swachh Vidyalaya Abhiyan the contract was awarded to RECPDCL on nomination basis. June 27 2016 NIL
REC Power Distribution Company Limited (RECPDCL) Wholly-Owned Subsidiary of REC Day to day monitoring of electrification of UE villages Around 1 year As part of Ministry of Power's mission to complete balance 18452 UE villages in the country in 1000 days the contract for day to day monitoring of RE works progress and surveillance quality checks on electrification of balance UE villages was awarded to RECPDCL on nomination basis and on cost plus basis upto an amount of ? 20 crore (Rupees Twenty Crore only) payable as project monitoring charges including logistic tour & travel gadgets etc. required for monitoring. The project monitoring charges were enhanced by additional T20 crore since the earlier approved amount of ? 20 crore was exhausted in July 2016. Due to urgency national importance of the assignment excellent performance of RECPDCL of monitoring the Swachh Vidyalaya Abhiyan the contract was awarded to RECPDCL on nomination basis. September 212016 NIL
Energy Efficiency Services Limited (EESL) Associate Company of REC Installation of LED lights Installation of LED lights on existing poles owned by Gram Panchayat with one year warranty and maintenance period in village Maghrol in Anand district Gujarat. In view of the technical competency of EESL in the field of renewable energy the contract was awarded to EESL on nomination basis. June 27 2016 NIL September 16 2015

2. Details of material contracts or arrangement or transactions at arm's length basis:No material contracts or arrangements or transactions were entered by the Company with anyRelated Party.

For and on behalf of the Board of Directors
P V Ramesh
Chairman & Managing Director
Place : New Delhi (DIN : 02836069)
Date : August 21 2017

ANNEXURE - IX TO BOARD'S REPORT

DETAILS OF DEBENTURE TRUSTEES APPOINTED BY THE COMPANY FOR DIFFERENT BOND SERIES AS ONMARCH 31 2017

{IN TERMS OF REGULATION 53 OF SEBI (LISTING OBLIGATIONS & DISCLOSURE REQUIREMENTS)REGULATIONS 2015}

Name & Address of Debenture Trustee

ISIN

Series No.

Secured/Unsecured

Redemption Date (DD/MM/YYYY)

Coupon

Rate

Listed at

Registrar & Share Transfer Agent

NSE BSE
1 IDBI Trusteeship Services Limited Asian Building Ground Floor 17 R Kamani Marg Ballard Estate Mumbai-400001 Contact: Mr. Ajit Guruji Phone : 022-40807001 Fax No : 022-66311776 E mail : aiit.auruii@idbitrustee.com resDonse@idbitrustee.com V\febsite: www.idbitrustee.com INE020B07DE1 83 Secured 28/02/2018 9.07% Yes No Beetal Financial & Computer Services (P) Limited Beetal House 3rd Floor 99 Madangir Behind Local Shopping Centre Near Dada Harsukhdas Mandir New Delhi-110062 Contact: Mr. Sanjay Rastogi Phone : 011-29961281-83 Fax : 011-29961284 Email : recbonds@amail.com beetal@beetalfinancial.com
INE020B07DG6 85 Secured 13/06/2018 9.68% Yes No
INE020B07DT9 86-A Secured 30/07/2018 10.70% Yes No
INE020B07DW3 86-B III Secured 14/08/2018 10.85% Yes No
INE020B07DY9 87-II Secured 01/10/2018 10.85% Yes No
INE020B07EB5 87A- III Secured 24/10/2018 11.15% Yes No
INE020B07EG4 88 Secured 15/01/2019 8.65% Yes No
INE020B07EP5 90 Secured 03/08/2019 8.80% Yes No
INE020B07ER1 90B-II Secured 04/09/2019 8.72% Yes No
INE020B07EV3 90C-II Secured 07/10/2019 8.80% Yes No
INE020B07EY7 91-11 Secured 18/11/2019 8.80% Yes No
INE020B07FC0 92-11 Secured 22/01/2020 8.65% Yes No
INE020B08427 94 Unsecured 09/06/2025 8.75% Yes No
INE020B08435 95-1 Unsecured 12/07/2019 8.70% Yes No
INE020B08443 95-11 Unsecured 14/07/2025 8.75% Yes No
INE020B08450 96 Unsecured 26/10/2020 8.80% Yes Yes
INE020B08468 97 Unsecured 30/11/2020 8.80% Yes No
INE020B08476 0 CPN-I Unsecured 15/12/2020 0 Yes No
INE020B08484 0CPN-II Unsecured 03/02/2021 0 Yes Yes
INE020B08492 98 Unsecured 15/03/2021 9.18% Yes No
INE020B08567 100 Unsecured 15/07/2021 9.63% Yes No
INE020B08591 101-111 Unsecured 10/08/2021 9.48% Yes No
INE020B08641 105 Unsecured 11/11/2021 9.75% Yes No
INE020B08740 107 Unsecured 15/06/2022 9.35% Yes No
INE020B08757 108-1 Unsecured 20/07/2017 9.40% Yes Yes
INE020B08765 108-11 Unsecured 20/07/2019 9.39% Yes Yes
INE020B08773 109 Unsecured 28/08/2017 9.25% Yes Yes
INE020B08799 111-1 Unsecured 19/11/2019 9.02% Yes Yes
INE020B08807 111-11 Unsecured 19/11/2022 9.02% Yes Yes
INE020B08815 112 Unsecured 01/02/2018 8.70% Yes Yes
INE020B08823 113 Unsecured 09/03/2020 8.87% Yes Yes
INE020B08831 114 Unsecured 12/04/2023 8.82% Yes Yes
INE020B08849 115 Unsecured 31/05/2023 8.06% Yes Yes
INE020B07HX2 116-11 Secured 17/10/2018 9.24% Yes Yes
INE020B07HY0 117 Secured 06/11/2018 9.38% Yes Yes
IDBI Trusteeship Services Limited Asian Building Ground Floor17 R Kamani Marg Ballard Estate Mumbai-400001 Contact: Mr. Ajit Guruji Phone : 022-40807001 Fax No : 022-66311776 E mail : aiit.auruii@idbitrustee.com resDonse@idbitrustee.com V\febsite: www.idbitrustee.com INE020B07HZ7 118 Secured 03/01/2019 9.61 % Yes Yes
INE020B08500

Infra Bonds Series-I (2010-11)

Unsecured 31/03/2021 8.00% Yes No
INE020B08518 Unsecured 31/03/2021 8.10% Yes No
INE020B08526 Unsecured 31/03/2021 8.20% Yes No
INE020B08534 Unsecured 31/03/2021 8.20% Yes No
INE020B07CU9 82 Secured 28/09/2017 9.85% Yes No

Karvy Computershare Private Limited Karvy Selenium Tower B Plot 31-32 Gachibowli Financial District Nanakramguda Hyderabad-500032 Contact: Mr. Venkat Babu Phone : 040 - 67161586 040 - 6716 1635 Email : vnbabu.aarikaDati@karw.com

INE020B07IA8 119 Secured 05/02/2019 9.63% Yes Yes
INE020B07IV4 122 Secured 18/06/2019 9.02% Yes Yes
INE020B07IW2 123-1 Secured 17/07/2021 9.40% Yes Yes
INE020B07IY8 123-111-3 yrs Secured 25/08/2017 9.25% Yes Yes
INE020B07IZ5 123-111-10 yrs Secured 23/08/2024 9.34% Yes Yes
INE020B07JB4 124 Secured 22/09/2017 9.06% Yes Yes
INE020B08856 125 Unsecured 11/10/2019 9.04% Yes Yes
INE020B08864 126 Unsecured 13/11/2019 8.56% Yes Yes
INE020B08872 127 Unsecured 04/12/2021 8.44% Yes Yes
INE020B08880 128 Unsecured 21/12/2024 8.57% Yes Yes
INE020B08898 129 Unsecured 23/01/2025 8.23% Yes Yes
INE020B08906 130 Unsecured 06/02/2025 8.27% Yes Yes
INE020B08914 131 Unsecured 21/02/2025 8.35% Yes Yes
INE020B08922 132 Unsecured 09/03/2022 8.27% Yes Yes
INE020B07IJ9

54EC Series IX (2014-15)

Secured 30/04/2017 6.00%

Unlisted

Link Intime India Private Limited

C-101247 Park L.B.S. Marg

Vikhroli (West) Mumbai - 400083 Contact : Mr. Shrikant Phone : 022-4918 6200 Fax : 022-4918 6060 Email : bond.helodesk@linkintime.co.in shrikant.oturkar@linkintime.co.in

INE020B07IK7 Secured 31/05/2017 6.00%

Unlisted

INE020B07IL5 Secured 30/06/2017 6.00%

Unlisted

INE020B07IM3 Secured 31/07/2017 6.00%

Unlisted

INE020B07IN1 Secured 31/08/2017 6.00%

Unlisted

INE020B07I09 Secured 30/09/2017 6.00%

Unlisted

INE020B07IP6 Secured 31/10/2017 6.00%

Unlisted

INE020B07IQ4 Secured 30/11/2017 6.00%

Unlisted

INE020B07IR2 Secured 31/12/2017 6.00%

Unlisted

INE020B07IS0 Secured 31/01/2018 6.00%

Unlisted

INE020B07IT8 Secured 28/02/2018 6.00%

Unlisted

INE020B07IU6 Secured 31/03/2018 6.00%

Unlisted

2 SBICAP Trustee Company Limited INE020B08930 133 Unsecured 10/04/2025 8.30% Yes Yes Karvy Computershare Private Limited
6th Floor Apeejay House 3Dinshaw V\fechha Road ChurchgateMumbai-400020Contact : Mr. Ajit JoshiPhone : 022-43025566 INE020B08948 134 Unsecured 14/08/2020 8.37% Yes Yes Karvy Selenium Tower B Plot 31-32
INE020B08955 135 Unsecured 22/09/2020 8.36% Yes Yes

Gachibowli Financial District Nanakramguda Hyderabad-500032 Contact: Mr. Venkat Babu

INE020B08963 136 Unsecured 07/10/2025 8.11% Yes Yes
INE020B08971 137 Unsecured 07/12/2018 8.05% Yes Yes Phone : 040 - 67161586 040 - 6716 1635
Fax : 022-22040465 INE020B08997 139 Unsecured 21/10/2021 7.24% Yes Yes Email : vnbabu.aarikaDati(karvv.com
Email : coroorateiSsbicaDtrustee.com investor.cell(sbicaDlrustBe.com V\febsite : www.sbicaDtrustee.com INE020B08AA3 140 Unsecured 07/11/2026 7.52% Yes Yes
INE020B08AB1 141 Unsecured 09/12/2021 7.14% Yes Yes
INE020B08AC9 142 Unsecured 30/12/2026 7.54% Yes Yes
INE020B08AD7 143 Unsecured 29/06/2020 6.83% Yes Yes
INE020B08AE5 144 Unsecured 21/09/2020 7.13% Yes Yes
INE020B08AF2 145 Unsecured 28/02/2022 7.46% Yes Yes
INE020B08AG0 146 Unsecured 03/09/2018 6.88% Yes Yes
INE020B08AH8 147 Unsecured 12/03/2027 7.95% Yes Yes
INE020B08AI6 148 Unsecured 17/06/2020 7.42% Yes Yes
INE020B07JC2 Secured 30/04/2018 6.00%

Unlisted

INE020B07JD0 Secured 31/05/2018 6.00%

Unlisted

INE020B07JE8 Secured 30/06/2018 6.00%

Unlisted

INE020B07JF5 Secured 31/07/2018 6.00%

Unlisted

INE020B07JG3 Secured 31/08/2018 6.00%

Unlisted

INE020B07JH1 Secured 30/09/2018 6.00%

Unlisted

INE020B07JI9 Secured 31/10/2018 6.00%

Unlisted

INE020B07JJ7 Secured 30/11/2018 6.00%

Unlisted

INE020B07JK5 Secured 31/12/2018 6.00%

Unlisted

INE020B07JL3 Secured 31/01/2019 6.00%

Unlisted

INE020B07JM1 Secured 28/02/2019 6.00%

Unlisted

INE020B07JN9 54EC Series Secured 31/03/2019 6.00%

Unlisted

INE020B07JV2 X (2015-16) Secured 30/04/2019 6.00%

Unlisted

INE020B07JW0 Secured 31/05/2019 6.00%

Unlisted

INE020B07JX8 Secured 30/06/2019 6.00%

Unlisted

INE020B07JY6 Secured 31/07/2019 6.00%

Unlisted

INE020B07JZ3 Secured 31/08/2019 6.00%

Unlisted

INE020B07KA4 Secured 30/09/2019 6.00%

Unlisted

INE020B07KB2 Secured 31/10/2019 6.00%

Unlisted

INE020B07KC0 Secured 30/11/2019 6.00%

Unlisted

INE020B07KD8 Secured 31/12/2019 5.25%

Unlisted

INE020B07KE6 Secured 31/01/2020 5.25%

Unlisted

INE020B07KF3 Secured 29/02/2020 5.25%

Unlisted

INE020B07KG1 Secured 31/03/2020 5.25%

Unlisted

SBICAP Trustee Company Limited6th Floor Apeejay House 3Dinshaw V\fechha Road Churchgate Mumbai-400020 Contact : Mr. Ajit Joshi Phone : 022-43025566 Fax : 022-22040465 Email : coroorateiSsbicaDtrustee.com investor.cell(sbicaDlrustBe.com V\febsite : www.sbicaDtrustee.com INE020B07GU0

2012-13PrivatePlacement

Secured 21/11/2022 7.21 % Yes Yes
INE020B07GV8 Secured 22/11/2027 7.38% Yes Yes
INE020B07GW6

2012-13 Public Issue Tranche-1

Secured 19/12/2022 7.22%

Yes

Yes

Secured 19/12/2022 7.72%
INE020B07GX4 Secured 20/12/2027 7.38%

Yes

Yes

Secured 20/12/2027 7.88%
INE020B07GY2

2012-13 Public Issue Tranche-2

Secured 27/03/2023 6.88%

Yes

Yes

Secured 27/03/2023 7.38%
INE020B07GZ9 Secured 27/03/2028 7.04%

Yes

Yes

Secured 27/03/2028 7.54%
INE020B07HM5

2013-14PrivatePlacement-1

Secured 29/08/2023 8.01 % Yes Yes
INE020B07HN3 Secured 29/08/2028 8.46% Yes Yes
INE020B07H01

2013-14 Public Issue Tranche-1

Secured 25/09/2023 8.01 % Yes Yes
INE020B07HR4 Secured 25/09/2023 8.26% Yes Yes
INE020B07HP8 Secured 25/09/2028 8.46% Yes Yes
INE020B07HS2 Secured 25/09/2028 8.71 % Yes Yes
INE020B07HQ6 Secured 26/09/2033 8.37% Yes Yes
INE020B07HT0 Secured 26/09/2033 8.62% Yes Yes
INE020B07HU8

2013-14PrivatePlacement-2

Secured 11/10/2023 8.18% Yes Yes
INE020B07HV6 Secured 11/10/2028 8.54% Yes Yes
INE020B07IC4

2013-14 Public Issue Tranche-2

Secured 22/03/2024 8.19% Yes Yes
INE020B07IF7 Secured 22/03/2024 8.44% Yes Yes
INE020B07ID2 Secured 23/03/2029 8.63% Yes Yes
INE020B07IG5 Secured 23/03/2029 8.88% Yes Yes
INE020B07IE0 Secured 24/03/2034 8.61 % Yes Yes
INE020B07IH3 Secured 24/03/2034 8.86% Yes Yes
INE020B07J07 2015-16 PrivatePlacement Secured 23/07/2025 7.17% Yes Yes
INE020B07JP4

2015-16 Public Issue Tranche-1

Secured 05/11/2025 6.89% No Yes
INE020B07JQ2 Secured 05/11/2025 7.14% No Yes
INE020B07JR0 Secured 05/11/2030 7.09% No Yes
INE020B07JS8 Secured 05/11/2030 7.34% No Yes
INE020B07JT6 Secured 05/11/2035 7.18% No Yes
INE020B07JU4 Secured 05/11/2035 7.43% No Yes
3 Vistra ITCL (India) Limited(formerly IL & FS Trust Company Limited)The IL &FS Financial CentreG Block Plot C-22Bandra Kurla Complex Bandra (E)Mumbai - 400051Contact: Mr. Sanjay DodtiPhone : 022-26593644Fax : 022-26533297Email : saniav.dodti(ilfsindia.comshailesh.kokateiSilfsindia.com V\febsite: www.itclindia.com INE020B08682

Infra Bonds Series-ll (2011-12)

Unsecured 16/02/2019 9.15% Yes No

Beetal Financial & Computer Services (P) Limited

Beetal House 3rd Floor 99 Madangir Behind Local Shopping Centre

Near Dada Harsukhdas Mandir

New Delhi-110062 Contact : Mr. Sanjay Rastogi Phone : 011-29961281-83 Fax : 011-29961284 Email : recbondsiSamail.combeetal(beetalfinancial.com

INE020B08690 Unsecured 16/02/2019 9.15% Yes No
INE020B08708 Unsecured 15/02/2022 8.95% Yes No
INE020B08716 Unsecured 15/02/2022 8.95% Yes No
INE020B08724 Unsecured 15/02/2027 9.15% Yes No
INE020B08732

Unsecured

15/02/2027

9.15%

Yes

No

Karvy Computershare Private LimitedKarvy Selenium Tower B Plot 31-32 Gachibowli Financial District Nanakramguda Hyderabad-500032 Contact: Mr. Venkat Babu Phone : 040 - 67161586 040 - 67161635 Email : vnbabu.aarikaDati(karw.com

INE020B07GG9

2011-12 Public Issue Tranche-1

Secured

28/03/2022 7.93%

No

Yes

28/03/2022 8.13%
INE020B07GH7

Secured

29/03/2027 8.12%

No

Yes

29/03/2027 8.32%