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HomeBusinessREC Ltd, RVNL sign Rs 35,000 crore MoU to finance infrastructure projects

REC Ltd, RVNL sign Rs 35,000 crore MoU to finance infrastructure projects

REC Ltd and RVNL sign MoU (Photo: PIB)

REC Limited, a Maharatna Central Public Sector Enterprise (CPSE) under the Ministry of Power, has signed a Memorandum of Understanding (MoU) with Rail Vikas Nigam Limited (RVNL) to extend financial support of up to Rs. 35,000 crore for infrastructure projects over the next five years. The agreement encompasses a wide spectrum of projects, including multi-modal logistics hubs, rail infrastructure, road development, port facilities, and metro projects that RVNL is venturing into.

Ajoy Choudhury, director (finance) of REC, and Rajesh Prasad, director (operations) of RVNL, inked the pact, solidifying the collaboration between the two entities. Other key officials, VK Dewangan, CMD of REC; Sanjeeb Kumar, director (finance) of RVNL; and Anupam Ban, DPE of RVNL, were also present.

REC Limited, established in 1969, is a “Maharatna” Central Public Sector Enterprise (CPSE) that operates under the Ministry of Power. Specialising in providing long-term financial solutions, REC has traditionally focused on the power infrastructure sector, covering generation, transmission, distribution, renewable energy, and emerging technologies like electric vehicles, battery storage, and green hydrogen.

In recent times, REC has expanded its portfolio to include non-power infrastructure sectors such as roads & expressways, metro rail, airports, IT communication, social & commercial infrastructure (educational institutions, hospitals), ports, and electro-mechanical (E&M) works for sectors like steel and refinery. The company’s loan book exceeds Rs 4,74,275 crore.

Rail Vikas Nigam Limited (RVNL), classified as a “Schedule ‘A’ Navratna” CPSE under the Ministry of Railways, plays a crucial role in fulfilling around 30 per cent of Indian Railways’ infrastructure needs. Beyond railway projects, RVNL has ventured into road development, port facilities, irrigation, and metro projects, often interconnected with railway infrastructure.

The signing of this MoU marks a significant step towards financing key infrastructure initiatives, contributing to India’s growth trajectory.

At the end of 2023, REC stocks witnessed the highest returns of 254 per cent among all 13 Maharatnas, followed by Power Finance Corporation, which achieved a gain of 238 per cent, according to a report by Mint.

REC Ltd stock was up 1.33 per cent, trading at Rs 425.35 as of 1 pm on Wednesday on NSE.

First Published: Jan 03 2024 | 2:12 PM IST

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