Ladies and gentlemen, good day and welcome to REC Limited Q2 FY 2026 earnings conference call hosted by Elara Securities India Private Limited. As a reminder, all participant lines will be in listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touchtone telephone. Please note that this conference is being recorded. I now hand the conference over to Ms. Shweta Daptardar. Thank you, and over to you, ma'am. Thank you, Shravani. Good morning, everyone. On behalf of Elara Securities, we welcome you all to Q2 FY 2026 earnings conference call of REC Limited. From the esteemed management, we have with us today Mr. Jitendra Srivastava, IAS, Chairman and Managing Director, Mr. Harsh Baweja, Director of Finance, Mr. T.S.C. Bose, Director of Projects, and Mr. Mohanlal Kumawat, Executive Director of Finance. We express our gratitude towards the esteemed team of REC Limited for providing us the opportunity to host this conference call. Without further ado, I now hand over the call to the REC team for investor presentation, followed by opening remarks by Mr. Jitendra Srivastava, Chairman and Managing Director, after which we can open the floor for Q&A. Thank you, and over to you, team. Thank you so much, and good morning, everyone. I shall now take you through to the investor presentation for the half-year FY 2025-2026. Just to inform you all, this presentation is also being uploaded on the website of REC and is also made available on the stock exchanges in compliance with the SEBI norms. The presentation is broadly covered into six areas, of which the first is the REC overview. As you know, REC began its journey in 1969 to develop power infrastructure in rural areas. From thereon, it has graduated many folds, and in 2022, we were accorded Maharatna status, which is the highest status for any public sector entity. Therein, we also forayed into the power, the infrastructure, and logistics sector in India, apart from the entire value chain of the power sector. We have the highest domestic credit ratings of AAA, international ratings of Baa3, BBB-, and AAA at par with the sovereign ratings of India. We are a nodal agency to flagship Government of India power sector programs. In fact, we are the first Indian public sector NBFC which is compliant with ISO 31000 Risk Management Framework. We are a major player in the renewable energy segment and creation of India's green energy corridor. We are also one of the strategic players in India's power sector, infrastructure, and logistics sector. We are a trusted Government of India arm, where we are supporting Government of India in various flagship schemes, such as RDSS, SAUBHAGYA, late payment surcharge scheme, consumer services ratings of DISCOM, and integrated ratings of DISCOM, Deen Dayal Upadhyaya Gram Jyoti Yojana, NEF, and most recently, the rooftop solar scheme. We have a diversified asset portfolio across our sector value chain that is conventional generation, transmission, distribution, renewable energy, and we have also diversified our portfolio into infrastructure and logistics sector as well. We have won various awards and accolades, and the most recent being we have been awarded the Best Financial Services Company by Dun & Bradstreet. We have also been awarded the Sustainability Icons Award for excellence in ESG initiatives. To take you through to the financial highlights for the half year, this half year, we have recorded our highest ever profits of INR 8,877 crore, which is a growth of 19% from the last quarter. Our total income has increased to INR 29,828 crore, that is a growth of 12%. The net interest income is increasing to INR 10,608 crore, a growth of 15%. The loan book has reached INR 5.82 lakh crore, a growth of 7%. The net credit impaired assets have reduced to 0.24%, and our net worth has reached its highest ever level of INR 82,739 crore. The capital adequacy ratio is sitting comfortably at 23.74%, as against the RBI requirement of 15%. On the profit and loss side, our half-year profits were at INR 8,877 crore, in which the interest income on loan assets was INR 28,686 crore, and the net interest income of INR 10,608 crore. The total compensation income was INR 7,081 crore. The key ratios, the yield on loan assets for the half year was 10.06%. The cost of funds at 7.17%. The consequent interest spread was 2.89%, and the NIMs comfortable at 3.64%. The return on net worth has increased to 22.14%, and the interest coverage ratio is comfortable at 1.62x. The debt equity ratio or the gearing ratio of the company has improved to 6.07x. On the operational performance of REC, we recorded our highest ever half-year disbursements of INR 1,11,547 crore in this half year, which is a growth of 27% from the corresponding half year of the last financial year. In Q2 itself, we have disbursed close to almost INR 56,000 crore, which is a growth of 18% from the corresponding quarter of the last financial year. The distribution segment has constituted the largest area of disbursement at 69%, followed by conventional generation at 11%, and renewables also at 11%. Consequent to such high disbursements, the outstanding loan assets have increased to INR 5,82,167 crore as of 30th September 2025, of which the state sector constitutes 86% of the portfolio and the private sector 14% of the portfolio. On the segment-wise reporting, 27% of our total AUM is in conventional generation, 12% in renewable energy, 8% is in transmission, and distribution constitutes 40% of our total loan book, while the infrastructure and logistics sector constitutes almost 10%. The borrowings of REC have reached to almost INR 5,00,700 crore as of 30th September 2025, which is diversified across all the areas of financing. To take you through to the asset quality, continuously improving the asset quality of REC, the gross NPA have reduced to 1.06%, and the net NPA have reduced to 0.24% as of 30th September 2025. On the NPAs, we have been maintaining a provision coverage ratio of 77%, and on the stage one assets itself, the provision stands at 0.86%, and these stage one assets are roughly 96% of our total asset book. The stage two assets are about 2.77% of the total loan book, wherein we have created a provision of 2.10%. The stage three assets or the NPA assets are currently at 1.06%, where the provision of 77% has been created. We are happy to inform you that in a continuous improvement of our asset quality, the stage two assets have been reduced by 52% in this current quarter itself from the last corresponding June quarter, where we have received a prepayment. We have recovered a prepayment of INR 11,400 million from Kaleshwaram Irrigation Project, which was a stage two asset till 30th of June 2025. These remaining NPAs or the credit impaired assets are in advanced stages of resolution. We have total 11 assets, of which 10 are under NCLT, where a provision of 77% is there, and one project worth INR 120 million is also being pursued outside NCLT with a provision of 20%. Now, to take you through the shareholder outlook, we have been consistently paying the highest dividend, and in fact, the Board of Directors have approved an interim dividend, the second interim dividend for the quarter of INR 4.60 per share, which is in addition to the INR 4.60 per share which was declared for the Q1 as well, thereby meaning a total dividend of INR 9.20 per share for the half year ended 30th September 2025. The earning per share has improved to INR 33.71 per share, and the book value at INR 314.21 per share. The shareholding pattern of REC has been given in the presentation, where you can see the PSC holds the 52.60% of REC shares, while the FII holds almost 18% of the total equity of REC. I'll quickly take you through the ESG initiatives of REC, where we formalized our ESG policy, which was adopted by the board in January 2023, and most recently in August 2025, we have published our second ESG report, which is referenced to GRI format submitted to CDP Responses. We have taken various ratings from ESG, and in fact, our renewable loan book has grown by more than 3x in five years, which gives a commitment of our ESG framework. In the last so many years, we have sanctioned almost 61 GW plus of renewable energy projects, which have an emission avoidance potential of 71.2 million tons, equivalent to 2.85 billion trees. The ESG and its highlights have also been given in the presentation. With this, now I'll request CMD to kindly give his opening remarks. Thank you so much, Supit. A warm welcome to my colleagues on the board, and a very warm welcome to all the investors who have tuned in to listen to our conference call. A very good morning to all of you. As all of you know, Supit has just given you the basic statistics with regard to the performance of REC, and I'm very happy to declare that the first half of 2025-26 has been very good for REC and for its shareholders. A few notable highlights I would just like to reiterate. They have already been spelled out. Highest ever half-yearly sanctions of INR 2.5 lakh crore. That is almost $28 billion were sanctioned in comparison to roughly INR 3.37 lakh crore of the same period last year. We are looking at a growth in sanctions of almost 34%, which is fairly large in any terms. Even if you look at actual disbursements, REC recorded its highest ever half-year disbursements of INR 1.15 lakh crore, which is almost $13 billion, which is an increase of 27% over last year's same time. Our loan book has increased by 7%. We have received pre-payments of almost INR 49,000 crore. That is $6 billion. Had this pre-payment not been received, the growth in the loan book would have been almost around 16% on a year-on-year basis. Now, let me clarify one thing. These pre-payments that have been received are those pre-payments which have primarily come from our borrowers returning the payment due to internal accruals, and a certain part of it has come from almost INR 16,000 crore have come from, sorry, INR 11,000 crore have come from the Kaleshwaram Irrigation Project, which has ensured that our stage two assets have reduced by almost 52%. This we consider as a major achievement, and we are very happy that today REC has a committed order book of nearly INR 2.5 lakh crore, which will support future growth. We estimate that even if we continue our disbursement at around 9%- 10%, we are confident of getting 11% to 12% loan growth in the coming years. As all of you know, we have very categorically said that by 2030, our loan book will touch INR 10 lakh crore, out of which the renewable sector, we are anticipating it to contribute to 30% of our loan book, which is INR 3 lakh crore. I would like to inform all our investors and our shareholders that we are well on track to achieving this. We are maintaining our steady pace. We are moving up to our target, and we are very, very confident that come 2030, REC will be a INR 10 lakh crore loan book company. Continuing this point, REC has recorded its highest ever half-yearly profit of almost INR 9,000 crore, which is a growth of almost 20% on a year-on-year basis, and our net worth has grown by almost 15% over last year. Continuing our stakeholder engagement, we are very happy that we have declared the second interim dividend also of INR 4.6 per share. This works out to almost INR 9.2 per share on a face value of INR 10 per share. We are very, very bullish on the power sector. We estimate that almost INR 46 lakh crore will be required over the next four or five years towards the entire power sector. For example, we are looking at the renewable energy capacity going up to 500 GW, where we are anticipating a market business of roughly INR 21 lakh crore. We are looking at additional thermal capacity of 80 GW, looking at roughly INR 5 lakh crore. We are looking at additional hydro capacity of 21 GW, which is around INR 1.16 lakh crore. We are looking at new nuclear capabilities of almost 22 GW, roughly INR 2 lakh crore. New pump storage projects with a capacity of 50 GW, with an approximate market potential of INR 1.85 lakh crore. Battery storage plants of roughly 74 GW, which is expected to touch around INR 1 lakh crore, and corresponding investments in the transmission and distribution, which should roughly aggregate around INR 13 lakh crore. Even assuming, as we very fondly say, that out of every four bulbs glowing in India, one is financed by REC, which is an indicator of a roughly 20%- 25% market share. Even if we maintain it, we are looking at roughly INR 10 lakh crore over the next five years. With our current loan book of around INR 6 lakh crore, we feel very confident that we should be able to touch INR 10 lakh crore by 2030. As you know, we are anticipating a huge power demand from data centers. We are anticipating that tariff reforms will keep on happening. We are very confident that payment security mechanisms to ensure that DISCOMs are able to pay power generators on time will only strengthen over the years to come. The clean energy integration is going to improve further. The battery storage systems, the pumped hydro, all of these are going to increase exponentially over the next few years, and these will further reinforce our clean energy integration and in compliance with the net zero achievement goal of 2070. We are very, very happy that we are partners with the Government of India, Ministry of Power, and we are the national implementing agency for two very, very prestigious schemes: the Revamped Distribution Sector Scheme and the rooftop solar scheme, the PM Surya Ghar Muft Bijli Yojana. In PM Surya Ghar Muft Bijli Yojana, we are the single implementing agency for the entire, for the very ambitious program, and this ambitious program seeks to target one crore households by 2028. We are very, very happy that so far we have touched roughly 17 lakh households have been covered under the rooftop solar scheme. If you look at the progress in the last six months, that alone accounts for almost 7 lakh households being added to this. Our progress has been very encouraging in the rooftop solar scheme. Similarly, in the Revamped Distribution Sector Scheme, where we handle 19 states and UTs, we are very happy with the progress of our states, and we are very confident that with the power regulators coming on board, with the state governments paying their subsidies and showing their commitment and renewing their political will from time to time, we are very, very confident that India's power sector is not just growing, it's transforming. At REC, we are proud to be financing this evolution. We realize that we are not just financing projects, we are enabling national priorities. Our portfolio, which spans generation, transmission, renewables, distribution, aligned itself with energy transition and smart grid initiatives, we are very confident that we will continue to play a significant role in the government's overall objectives. I would also like to mention that our foray into infrastructure will keep on continuing. We are actively looking at new avenues of growth. Very recently, we have, even as we speak today, we'll be signing an MOU with the Ministry of Shipping for investment in the maritime sector of our country, shipping and maritime sector of our country. Similarly, the metros, the ports, the road transport schemes, and the road transport projects, any good infrastructure project which has steady revenue streams is going to be our priority, and we are working very hard with the state governments and with the private sector partners to ensure that going from strength to strength. As I conclude, I extend my heartfelt gratitude to the Honorable Minister of Power, the Honorable Minister of New and Renewable Energy, the Honorable Minister of State for Power and Renewable Energy, the Secretary of Power, and all esteemed officials of the Ministry of Power for their steadfast support and visionary guidance. Last but not least, I would like to thank my colleagues on the Board and the wonderful employees of REC who are working very, very hard to ensure that REC meets our expectations and we achieve all our commitments. Thank you so much. Over to you. We can now open the floor for the Q&A, please. Thank you. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use the headsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Abhijit from MOFSL. Please go ahead. Yeah. Good morning, everyone, and thank you for taking my question. Sir, I just wanted to ask you two questions. One is, I mean, this Kaleshwaram Irrigation Project, right, very clearly, it's a good thing that we have received given that it was a stage two asset. When we dilate for the 12% growth in FY 2026, loan growth of 12% in FY 2026, was this factored in? Now that task rate for the second half is much higher, are we confident that we will be able to deliver on the guidance, or is there a reason to believe that the growth will actually be lower than what we had guided at the beginning of the year? Yeah, you said you will be asking two points. I'm assuming that's only. Yes, sir. I can maybe complete the second question as well. The other thing I wanted to understand is, on and off we keep hearing that both Hidden Main Power as well as Sasan Power are in advanced stages of resolution. Is there a case that any of these two could get resolved in the current quarter? What I'm trying to understand is if you could briefly share what is the status of resolution in some of the stress assets for us. Those two questions. Okay. I'll answer them first. Yes, we are very happy that almost INR 11,000 crore from Kaleshwaram has come back to us, reducing our stress assets in the stage two category by almost INR 16,000 crore, which is a reduction of roughly 52% in our stress assets, stage two stress assets. To your second part, whether we are still confident of achieving a growth rate of 11%- 12%, absolutely. We have already done INR 1.15 lakh crore. That is with a prepayment of almost INR 12,000 crore from Kaleshwaram. This growth that you see is with the prepayment, and we honestly don't foresee too many prepayments coming in the remaining two quarters. If we continue to maintain our disbursements, and we are fairly confident of that, I don't see any reason why we should not touch 11%- 12% by the end of this financial year. With regard to the second question on Sena progress, I will request my Director of Finance to just update you on the Sena project. As you know, we are in the process of becoming a net zero company by the financial year 2026. We expect that these main assets, that is Sena and the Hirakud, will be resolved by the year, by Q4. These are at the advanced stage of resolution. Hirakud, the outcome of the final hearing is to come in this quarter, Q3 only, and the Sena. The Hirakud is now with the Supreme Court. Some judgment is to come from the Supreme Court, and that will take place. We are confident that all assets, around 11 or 12 assets, are there, that all will be resolved in the financial year 2026. Got it. Sir, just one follow-up question. You said that you do not foresee too many repayments coming in two ways in the second half. What makes us think that? Because in the first half, as you acknowledge, prepayments were particularly elevated. You shared in your opening remarks that they have prepaid almost INR 49,000 crore in 1H, including the INR 11,000 crore from Kaleshwaram, and predominantly out of their own internal accruals. Don't you think this trend of higher prepayments could sustain in the coming quarters as well? You will appreciate that out of the INR 49,000 crore, the major have come from the Kaleshwaram. That is around INR 12,000 crore. Then INR 10,000 crore has come from the RVPF scheme of Andhra Pradesh and Telangana. What they have done, they have availed a long-term loan from us, and they have prepaid this extraordinary amount to REC. This INR 28,000, this is 12 plus 10,000. It's around INR 22,000 crore have received on these accounts. These are the one-time scenario. The rest is the Adani. They have made a pre-payment of around INR 3,000 crore. That is, again, since their headroom was not there for further sanctions, they have submitted some of the new schemes to us, and that is where they have prepaid us. All is around INR 25,000 crore have come from the RVPF schemes. Not INR 25,000 crore. It is around INR 20,000 crore, which has come from the RVPF scheme, where the scheme in itself says that anyone DISCOMs having the surplus cash available may make pre-payment to us, and thereafter, they can avail the funds as and when required with them. That activity will keep on going on. Other than RVPF and the balance payment of the Kaleshwaram, we don't expect much of the pre-payment coming up in the next two or three or four quarters, three and quarter four. I'd just like to supplement this figure. We must, I must, you must realize that we have a committed order book of nearly INR 2.5 lakh crore. If we look at previous year pending sanctions also, which have yet to translate, the actual kitty which we are looking at for disbursement is much more than that. We are very confident that, yes, our pre-payments will be controlled. We don't anticipate any major pre-payments apart from the ones which DS has just mentioned. Even after factoring those pre-payments, we are fairly confident that we should be able to achieve a growth of over 12%, 11% to 12%, 11% to 12%. Got it, sir. This is very useful, and I wish you and your team the very best. Thank you so much. Thank you. The next question is from the line of Kushagra Goel from CLSA. Please go ahead. Hi, sir. Thank you for taking my question. First is on the, there was a draft regulation. Your volume is very low. The volume is very low. Yeah, better now. Yeah, sure. I will just repeat. First question is that there was a draft amendment by RBI in which they were proposing to lower capital requirements for lending to high-quality infra projects. I just wanted to know your thoughts on this. How can this benefit us, or can this lead to higher competition? That was one. Second is on your margins. I just wanted to understand that as RE shares will increase in our books, can that lead to lower margins for us? How should we broadly think about that? Those are my two questions. First of all, as far as the RBI guidelines have come, these are at the draft stage, and these guidelines are good for us. We are also submitting our comments to the RBI. We have seen in the past also that whenever the final guidelines are issued, they are generally issued much refined. If you see that these guidelines basically have come as a replacement of the earlier PPP guidelines which were in place, these are the guidelines in a much better shape. We expect that the feedback from many of the institutions, in that case, we can expect that these guidelines would be in a much better shape. As regards your second question regarding the renewable portion, yes, we expect that renewable portion will increase. Similarly, we are expecting that the share of distribution and the generation will also keep on increasing. If you see that as of now, my renewable share is around 12% out of a loan book of INR 582,000 crore. For example, if it touches around INR 1 trillion and my renewable share gets increased to 25%, that is not going to affect since by that time, my net worth would be around, from as of now, it is around INR 82,000 crore, which may touch around INR 140,000 crore. We would be able to maintain our NIM between 3.5% to 3.75% and a spread between 2.75% to 3.5%. Whatever the benefits to pass on due to the competition in the renewable sector, some of that may come from the growth of the net worth, as well as the new business, which is a higher building business that is coming from the generation and the distribution sector. Got it. Got it, sir. Thank you. Thank you. The next question is from Kunal Shah from Citigroup. Please go ahead. The question was particularly on margins for this quarter and in terms of the overall cost of funds. The borrowings have remained flat, or it has come off marginally on a quarter-on-quarter basis, but still, the finance cost is up quite a bit. Not able to get in terms of the increase in the cost of funds during the quarter wherein we would have seen some benefit of repricing of the liabilities. If you can just highlight that, yeah. As far as my borrowing cost is concerned, that has increased a little bit, since that is all because of some of the risk mitigation measures which we have taken in respect of the foreign borrowings. Since because of the volatility, we had to take some of the measures that have added to the cost. As regards my borrowing cost, almost 80%- 85% is of the fixed cost nature. Generally, out of that, only 20% redeemed in a year, and all that the loan gets redeemed in the next five, over a period of five years. That affects in the years to come, not immediately affects my borrowing. Because of this, the extra measures which we have taken and the fixed nature of my borrowing, this has just increased from 7.12%- 7.17%. Okay. For the quarter, it would still have been higher. It would have been like, say, 10 or 12 bps increase. This is for the first half which you are indicating. In terms of this, it was largely maybe on this INR 1,055,000 crore of foreign currency borrowings. Was there some risk, maybe some cost which was incurred on the hedging? Now, when we look at it in terms of the overall hedge, out of this INR 1,055,000 crore, how much is hedged and how much is unhedged? As far as my hedging for this foreign borrowing portfolio is concerned, almost 99% is hedged, which is as per the RBI guidelines. Okay. What was the cost incurred towards what you mentioned, like in terms of optimizing the foreign currency borrowing, which led to increase in the cost? What was that cost related to? I can say that in terms of the paisa, it is around INR 0.08 to INR 0.10, which has added to my cost of borrowing. Okay. I was just checking in terms of the nature, yeah. That's all because of the increase in the production level which we have taken. We have taken a seagull based off hedging. In that case, we have increased the EKI level to give us more protection against any of the volatility which is happening in the international market. Perfect. Got it. Secondly, if you can quantify, obviously, you are expecting a lot of resolutions coming through in the second half towards all the NCLT cases, even though the quantum is still like INR 6,000 crore. Eventually, when we look at it, what could be the repayment run rate which we can expect over the next couple of quarters and for the second half? The repayment or the pre-payments you're asking about? The repayment? Pre-payments, yeah. Both put together in terms of the expectations. Actually, every month we have a repayment of around INR 8,000 to INR 9,000 crore. That is a regular repayment. Other than that, we have the pre-payments on account of the RVPF, which I have just mentioned. The characteristic of the scheme itself permits that borrowers can always make a pre-payment whenever the cash surplus is available with them. Thereafter, they again seek further funding from us whenever they need the fund. That will continue to happen in our portfolio. For the rest of the things, we are not expecting much of the pre-payment except what we have just said in the beginning of our conference. That is coming from the rest of the amount from Kaleshwaram. That is around to the tune of INR 5,000 crore. I don't think that other than that, that is anticipated. Maybe under INR 5,000 more per quarter may come. Okay, got it. Okay, thanks. Thanks and all the best. Thank you. The next question is from the line of Shreepal Doshi from Equirus. Please go ahead. Hi, sir. Thank you for giving me the opportunity. Firstly, I just wanted to have some clarity on this Kaleshwaram Irrigation Project total exposure. With respect to incremental pre-payments, all of it would be received in Q3 itself, or can that get, let's say, split into two, three quarters sort of a time period? Kaleshwaram total outstanding was around INR 17,000 crore, of which INR 11,800 crore have already been received. The rest, since it is a space to assess, and we have always focused on the quality of the assets. That is why we have recurred this much amount from the Kaleshwaram, and that has gone into some kind of litigations also. It is good in the interest of the company that we get the prepaid for that. That is why we decided to accept the prepayment for the Kaleshwaram loan. We expect that the rest of the amount may come in Q3 and Q4. It is good for the company that the stage two assets get lowered. Got it. Sir, how much of it, like from the provisioning point of view, this quarter we would have benefited because it was stage two and we were carrying higher provisions? How much of the provision got reversed or released because of this prepayment during the quarter? That was not much of the amount, since the project was secured against the government guarantee. It was not a very significant amount which got reversed because of this prepayment. Okay. The second question was pertinent to the cost of fund. The India sovereign rating has also improved in the last six months sort of a time period. Have we seen any benefit to us for our foreign borrowing plans? You said that 99% of our foreign borrowing is hedged. To what level of rupee against the dollar is it hedged? Let's say if rupee goes to 990, what is the kind of implication that we can have in the PNL? These are the two questions pertaining to the borrowing side. You have said about the cost of borrowing. Yeah, because India's sovereign rating has improved. Any benefit that we are seeing, any fears, and how much are we seeing in terms of our foreign borrowing? For example, in case we go for the international borrowing or if we go for the bond raising fund through the bond, that gives us little benefit. Otherwise, we are already at the highest level of the sovereign rating. That is not going to give us any significant benefit out of it. The second question was regarding the hedging limit. Hedging. Yes. For the different kind of loans, we have a different limit. As of now, against the dollar, we are very well within the limit. Okay. Is it fair to assume that up to, let's say, INR 18,990, we would be better? If it breaches that level, there could be implications in the P&L? Up to 90%, there should not be any issue. Got it. We are hedged much beyond that. Okay. Got it. We are hedged for beyond 100. That would be for the fresh borrowing that we would have done in the last three months, sort of a time period. Is it fair to assume that way? The fresh borrowing which we have taken, if it is for one year, then that is coming at around 95 or 96. If it is for five years, that is much beyond the 100. That is not a question. The ECBs, which are maturing in Q3 and Q4, I was talking about that. As far as against dollar is concerned, as on that, there is no question. Let's see. We are always a proactive treasury management system, so we always take advanced action in case if any problems we anticipate that is going to come. Got it, sir. Got it. Thank you so much, sir, for answering my questions. Thank you. Ladies and gentlemen, in order to ensure that the management is able to address questions from all the participants in the conference, please limit yourself to two questions per participant. Should you need any follow-up questions, you may rejoin the queue. The next question is from the line of Chintan Shah from ICICI Securities. Please go ahead. Hi. Thank you for the opportunity. Firstly, on the growth front, in terms of competition, given that we have a 20%-25% market share and the potential market size is quite huge, after the repo rate cuts, are we seeing the competition increasing, particularly from PSU banks or from government institutions like NaBFID or any other type of institution? That could potentially lead to some pressure or ease going ahead. Have you revised any car trades in the last six months or so? That's the first question. We had reduced car rate in the month of May. You will have to understand that we are also in the business. What is evident is that our disbursement has grown substantially during the last Q1 and Q2. That is evidence that we are very much proactive in the market, and we are very much competitive in the market. On that front, you need not to worry. We expect that the competition will come as far as the renewable sector is concerned from the market. There, our rates are the lowest in the market. As far as the other sectors are concerned, REC and the PFC majorly will lead. We already have the share of around 20%- 25%. We'll continue to maintain that share. Okay, 20%- 25% share of REC and PFC each. Sure, sure. Okay. That is helpful. Sir, just one thing again on the borrowing cost trend. If, for example, there is a 3%- 4% depreciation in the USD/INR in a particular quarter or so, then potentially will that result in some rise in our hedging costs again? Like from 90 to 93, if it goes in the next two or three quarters, that would again lead to some rise in our hedging costs. Is that a fair assumption? Yeah. Actually, in that case, suppose if we have taken funds in the past, we don't have a production level up to 90. There may be a production level of 92, 93, or 95 also. Ultimately, as each transaction is maturing on the day, we have to decide what kind of action we have to take. Our action starts even one month prior to that. We see the trend, and on that basis, we used to decide whether we have to increase our EKI limit or not to increase our EKI limit. This all depends on merit. Sorry, sir. If there is some random movement of 3% or 4% in a particular month or so, that could lead to some rise in the hedging costs. That is right. I think that would be a random movement. It wouldn't have the kind of random movement you're talking about, will need an apocalypse. You cannot plan for an apocalypse. Understood. Sure, sure. Fair enough. That's it from my side. Thank you and all the very best. Thank you. Thank you. The next question is from the line of Avinash Singh from Emkay Global Financial Services Ltd. Please go ahead. Yeah. Hi. Good morning. Thanks for the opportunity. Questions around growth. I mean, the guidance broadly for the next five years looks kind of very, very clear. If we were to see the growth trend, particularly in the segment like conventional generation, your large part of, I mean, if I see your borrower category here in the state utilities, but there, despite whatever NEP targets and all, the momentum as far as the new thermal power in the state sector is concerned, the state utilities, it's very slow. If you see this trend continues, do you see your conventional generation disbursement or AUM growth revising? Because that is right now very, very anemic. The second, if you can help, the transmission, that's a kind of a small portion of your book, but that has also declined. I can understand the infra and logistic part is largely due to Kaleshwaram, but here, transmission has also declined. What is going on there? Lastly, your state and private mix has now gone to 86/14 because the private part, particularly led by renewables, is going faster, which is kind of lagging. To what level would you be comfortable in this kind of AUM mix between state and private? Thanks. I'll take your last question first. We don't plan exactly when we look at key what would be a comfortable government or private. We don't go by the nature of the borrower. We go by the nature of the project and its potential to deliver well. We fund irrespective of whether it's a government project or a private sector project. I hope that answers your question. As long as it's a good project, it gives you a good revenue stream, we will fund it. We will keep on funding it irrespective of whether it's a government project or a private sector project. That's the first part. What was your second part? I'm sorry, I don't recollect your question. Could you just repeat it shortly? Our second part is that you know what is happening there in the transmission, your transmission part of your book, because that is also seeing decline. Kaleshwaram would be sitting under infra and logistics, if I am correct. What is leading to this decline in transmission? That's why my second question. Third, of course, how do you see estate utility level commerce project, conventional generation project picking up? They are quite slow and running much behind whatever we're in in NEP 2032. Yeah. If you see my entire data, the generation sanctions have increased from INR 53,000 crore in H1 2025 to INR 1,13,000 crore. Similarly, transmission has increased from INR 13,000 crore- INR 14,000 crore. Renewable, this time it was sanctioned around INR 45,000 crore. Distribution has increased from INR 36,000 crore- INR 71,000 crore. That is evidence that the regular business is flowing. We are not seeing any kind of challenge in taking up these projects by the state sector since these projects have come with the DPR with us. These have been duly appraised. The projects which have come up for sanctions will be definitely implemented by the states or the private sector, wherever it is. What explains this decline in transmission? It is not a decline. It is not a decline. Last year, H1, we had sanctioned INR 13,000 crore. This time, we have already sanctioned H1 INR 14,000 crore. It is not a decline. As far as the disbursements are concerned, sometimes what happens is that some of the disbursement in distribution schemes takes place at the early phase, whereas in transmission, it takes at a later phase. That might be the reason for that, but it is business as usual. Okay. I was talking of loan book. I mean, loan book has been nearly INR 49,000 crore last year. This year, right now, it's INR 44,000 crore. Yeah, nearly a 19% decline there, loan book. That's what I was talking about. Oh, it is just because, see, those are seasonal fluctuations. You should be worried if there are sanctions or not. That is a matter of worry. If you look at our sanctions, in H1 FY 2025, it was INR 53,879 million, let's say roughly INR 54,000 million. It has gone up in H1. It has gone up to INR 113,000 million. You're looking at almost a 45% growth in sanctions in generation. Okay, sir. Thank you. Thank you. The next question is from the line of Nikhil Nigania from Bernstein. Please go ahead. Hi. Thank you for taking my question. My first question is on the DISCOM debt side. There have been rumors that the DISCOM debt has become quite large. Is there any chance of restructuring or any discussions on debt restructuring for DISCOMs that are happening? If it does, what are the consequences you see for that debt being transferred to the state government or any risk of a rate cut which we might have to take? If you could please answer that. I'll just come in from the first part. As far as debt is concerned of DISCOMs, primarily six states account for a huge amount of the debt. I think it's UP, Karnataka. I'm forgetting the names of the states, but primarily it's concentrated in six states. The Government of India is working for a debt restructuring package that's in the process of development. I think consultations are at an advanced stage, and the group of ministers is seized of this issue. It would not be proper for me to comment on this until something more concrete has come out. Let me assure you that whatever is finally taken, I think a better balance sheet on the distribution sector will only yield better results for us because then CapEx can really take off. Once the debts are cleared, the CapEx of DISCOMs will really take off. That is when I think other indices like electric supply, reliability of supply, hours of supply, quality of supply, all these things will go up. I think it's a win-win situation we are looking at here. The specifics are still not very clear. It's under at a higher level of discussion. I hope that answers your question. I appreciate that response. Just one follow-up to that. Do you see any risk of our spreads being asked to be compressed on the discount debt side due to this? I think that's a matter for the future. Let us take that call as and when it comes. It will not be proper for me to speculate on this. Got it. Appreciate that, sir. The second question I had was on the project financing norms. Now that they have come into play, was that the impact we saw in the provisioning this time, or is that something we'll see in subsequent quarters? Actually, that is coming to intersect from the 1st of October. It is not going to have much of the effect on the balance sheet for the financial year 2026. Gotcha. Understood. That will be available on the new project sanction and to be documented post 1/1/2025. That is not going to make much of the effect on my balance sheet for the financial year 2025/2026. I would also like to mention that these provisioning norms are applicable for everybody. It will affect everybody equally. I don't think that should bother us too much. Got it. Appreciate that, sir. Those are my questions. Thank you. Thank you. The next question is from the line of Saket Yadav, India Capital. Please go ahead. I think we can take the next person. Hi, good afternoon, sir. Yeah, you're all right. Yeah, you're all right. Please go ahead. Sorry about that, sir. Thank you. Thank you for the clear updates, and thank you, CMD, sir, for laying out the long-term vision so clearly. My question was primarily on asset quality. Apart from the one account, Kaleshwaram account, where we have received the repayment, the other stage two assets, do you foresee, does the company foresee any risks over there, or are they largely contained? No, we don't see any kind of risk associated with them. In some of the cases, that is Teesta Urja and the Odu Power. These two cases are concerned, they have been regularly making the payment. Since the Odu case, their rating was not available, that is why we have placed in the stage two. As far as Teesta Urja is concerned, that is a restructured asset. TRN is again a restructured asset. As per the RBI provisions, we have to keep it in the stage two. For the rest of the assets, these are the government projects where we are regularly getting the repayments. Sometimes what happens, it goes beyond 30 days, that is why we have to place it in the stage two. We are not seeing any kind of challenge or any kind of difficulty in recovering these amounts. Understood, sir. Thanks for that. That's it for me, sir. Thanks. Thank you. The next question is from the participant, Harshit Toshniwal from Premji Invest. Please go ahead. Hello, sir. Am I audible? Yeah, could you speak louder, please? Yes, sir, the question was regarding the privatization of DISCOMs. We have in UP government, specifically, for example, the first stages there were probably it's on the tender and two out of the six DISCOMs will be privatized. Now, sir, if I look at the trend, as you said, that if DISCOM balance sheet improves by government help and it remains a government entity, till then it is beneficial for us. For example, if it gets privatized, then the private player will not seek debt from us. He will want to seek debt at a much better rate from the other financial institutions. In that case, what is the risk you envisage that still 40% of your AUM is through distribution companies? If the trend of privatization happens at a much faster pace in the next five to six years, is it a risk that you foresee to your INR 10 lakh crore AUM target? How should we look at that? What makes you think a private discount will not come to REC for funding? What makes you think we will not be in a position to give them competitive rates? If you are scared that we'll lower our interest rates too much, let me assure you that while our rates will remain competitive, it is not just rates that come into factor when you are deciding a loan portfolio. There are a number of other conditions, pre-disbursement conditions, post-disbursement conditions, which also come into play. All these are taken into account by the borrower before he takes the final call on his borrowing. It is not just a single variable of interest rate. I would urge you not to pay too much importance to just interest rate. Yes, it is an important determinant. Like I said, there are other conditions which are equally important. I honestly don't think even with private discounts coming in, we will have too much of a problem. Got it. The point was that, for example, if it's a Tata and if they are running a particular DISCOM, then will their propensity to take debt, so obviously rates being one of the factors because of the fundamental balance sheet of that DISCOM being much better and it being a private player, do you think the competition in that segment increases and that creates some pressure for us? I'm seeing more economically, how will, say, if it's a Tata Group on the other end, how will they decide on the selection of the lender? That's a question which you'll have to ask Tata Group, not IT. Right. If I can ask you, sir, in your assessment. My request is let us not enter into a debate on this. I've said what I wanted to say. I hope you will appreciate that I have been more than candid, and I would request you not to speculate on this too much. Okay, sir. Privatization is a thing which is going to happen or may happen, may not happen. What are the pitfalls? We are presuming privatization will be good. There could be pitfalls there. A lot of issues are there. Let things unfold. Let us not put the cart before the horse. Got it. Got it. Okay, sir. Thank you. The next question is from the line of Piran Engineer from CLSA. Please go ahead. Hi, sir. Thanks for taking my question and congrats on the quarter. If you could tell us what is your stage two number as of September 30th? INR 16,112 crore, of which Ryan Simha is INR 740 crore, TSW-RIDC is INR 9,700 crore, Teesta Urja is INR 3,300 crore, TRN MLG is INR 1,000 crore, and the XL Jarghi Odu Power is INR 1,200 crore. The total is around INR 16,000 crore, and we are getting regular repayments from them. Okay. Last quarter, it would be INR 28,000 crore because Kaleshwaram. Last quarter, it was INR 33,000 crore. 33? Yes. Okay. Sir, just on this Kaleshwaram thing, how did they resolve the project? Was it moved to the state government? Actually, we are concerned with our repayments, and the state government is making repayment to us. That is good for us. How they are making the payment, how they are making the things good for them, it is up to their business. We are getting regular payments for that, and that is good for us since the project is subject to many litigations as of now. Got it. Okay. Yeah, that was it from my end. Thank you and all the best, sir. Thank you. The next question is from the line of Shreepal Doshi from Equirus. Please go ahead. Hi, sir. Thank you for giving me the opportunity once again. My question was pertaining to the pricing. When we say that we're focusing on projects where there is government. Your voice is not very clear, sir. Excuse me, but please. Am I audible now? Yeah, you're a little better. Yeah, my question was on pricing. When you say that we are focusing on projects where there is steady cash flow and also where there is state government involvement, are we not facing any competition there from banks? What sort of pricing or spreads do we believe can play out in such projects? Let me put it this way. I mentioned this to a previous person. I'm forgetting his name who had asked this question. When a person takes a decision to fund a project, we look at the IRR of the project, number one. We look at the credentials of the promoter or the state government or the entity, as the case may be, whether it's a private or a state government entity. We look at the government guarantee or lack of it. We take that into consideration. Having said this, the borrower also, apart from the interest rate, looks at ease of delivery, ability to decide fast, ability to take decisions based on peculiar conditions which they are facing, ability to relax conditions to suit their interest. I think REC scores very high on all these other parameters. That is not to say that we don't compete on the interest rates. We compete on that also. I think overall we are a good package. Got it, sir. Got it. That answers my question. Thank you. Thank you. The next question is from the line of Uma Menon from Bernstein. Please go ahead. Hi, sir. Thank you for taking my question. One thing that I wanted to get clarity on was the increase in the provision expense during this quarter. If you could just break down or break it down on what were the factors for that expense and how much was the reversal from Kaleshwaram. If it's readily available, you can share it. Otherwise, we can email it to you. I think we'll email you the details. Sure, sir. As far as the regular disbursements are concerned, we have made a provision of INR 371 crore. In the half year, that is for the half year, some reversals have taken place because of the rebatings of the borrowing agencies. That was INR 561 crore. LGD changes - INR 101 crore. Delay in COD, we have made an extra provision of INR 106 crore. Reversal on account of TRN Energy was INR 272 crore. Overall, for H1, it is -INR 490 crore. All right, sir. Thank you, sir. Thank you. That was it. Thank you. Due to time concerns, we have to come to an end of the question and answer session. I now would like to hand the conference over to the management for the closing comments. I would like to thank all of you. We feel proud that we are able to deliver, and we are happy that your questions came. We are very impressed by the quality of the questions also. We look towards your questions also as possible indicators or as correction strategies. I think we could not take four people who were in the queue. We would appreciate it if you could just email us your questions, and we'll get back to you. Feel free to reach out to us for any other queries you might have. Thank you one and all for taking part in this con call. We are happy to be of service, and we hope to continue performing like this over the next two quarters also. Thank you so much. On behalf of Elara Securities India Private Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.