REC Ltd announced a 1st interim dividend of ₹4.25 for FY27 and a final dividend of ₹1.55 for FY26. The company also approved a merger ratio with PFC, offering 88 PFC shares for 100 REC shares. Strong profits of over ₹4100 crore were reported for the June 2026 quarter.
Detailed Coverage
REC Ltd Announces Dividends and Merger Scheme with PFC
REC Ltd has declared a 1st interim dividend of ₹4.25 per equity share for the financial year 2026-27, with a record date of July 31, 2026. Additionally, a final dividend of ₹1.55 per equity share for the financial year 2025-26 has been announced, with a record date of August 14, 2026.
The company's Board of Directors has also approved a draft scheme for its merger by absorption with Power Finance Corporation Limited (PFC). The approved exchange ratio is 88 equity shares of PFC for every 100 equity shares of REC Limited. This merger is contingent upon obtaining necessary approvals from statutory and regulatory authorities, as well as from shareholders and creditors.
What just happened
REC Ltd will pay interim and final dividends and has agreed to merge with PFC at a set share exchange ratio, subject to approvals.
Why this matters
These corporate actions offer direct shareholder returns via dividends and signal a significant structural change through the proposed merger with PFC.
The backstory
REC Ltd is a major financial institution focused on the power sector. Mergers and acquisitions are common in the financial services industry to achieve scale and operational synergies.
What changes now
Shareholders can expect dividend payouts. The merger, if approved, will consolidate REC into PFC, altering the corporate structure and potentially influencing future strategic direction.
Risks to watch
The primary risk is the delay or failure to obtain regulatory and shareholder approvals for the PFC merger.
Peer comparison
REC and PFC are key entities in India's power sector financing. Their merger would create a larger, more integrated financial powerhouse.
Context metrics (time-bound)
- Standalone Net Profit (Q1 FY27): ₹4,149.46 crore
- Consolidated Net Profit (Q1 FY27): ₹4,192.76 crore
- 1st Interim Dividend FY27: ₹4.25 per share (Record Date: July 31, 2026)
- Final Dividend FY26: ₹1.55 per share (Record Date: August 14, 2026)
What to track next
Investors should monitor the progress of the merger approvals and the timeline for dividend payments.