RECLTD (REC Limited) vs BSE Sensex 30 Comparison

RECLTD

BSE Sensex 30

Compare the stock's returns with its benchmark index and competitors. Gain insights into its relative performance over time.

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RECLTD

BSE Sensex 30

Difference

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RECLTD

BSE Sensex 30

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Compare the stock's returns with its benchmark index and competitors. Gain insights into its relative performance over time.

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BSE Sensex 30

RECLTD

IRFC

PFC

8593

EFN

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1Y 3Y 5Y 10Y 15Y 20Y

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REC Limited
Glance View

Economic Moat

None

Market Cap

1.2T INR

Industry

Financial Services

In the bustling corridors of India's financial landscape, REC Limited emerges as a stalwart, quietly fueling the nation's energy infrastructure. Founded in 1969, originally known as Rural Electrification Corporation Limited, the company has woven itself deeply into the fabric of India's power sector. As a public infrastructure finance company, REC Limited plays a pivotal role in supporting the development of electricity projects across the nation. The company’s journey is marked by its relentless dedication to bridging the power divide between India's urban and rural areas. With robust mechanisms for mobilizing financial resources, REC lends a lifeline to various power producers, state electricity boards, and private sector entities. Its reputation is built on facilitating secure and timely financial support, thereby ensuring electrification reaches the farthest corners of the country. Central to REC's operation is its business model, which generates revenue primarily through interest earned on its financial products. This includes loans tailored for diverse facets of the energy sector—be it generation, transmission, or distribution. REC’s strategic prowess lies in its underwriting capabilities and risk assessment, positioning it as a critical financial partner in India's evolving energy landscape. The company's portfolio is characterized by a mix of conventional and renewable energy projects, reflecting a balanced approach towards sustainable development. REC Limited not only commits capital but also brings strategic planning expertise to the table, ensuring energy projects are not only financed but effectively executed, catalyzing progress in India's quest for energy security and sustainability.

View RECLTD Analysis

RECLTD Intrinsic Value

What is Intrinsic Value?

Economic Moat is a concept popularized by Warren Buffett to describe a company's durable competitive advantage. It represents the 'moat' that protects a company from competitors and helps it sustain profitability over the long term. Our analysis of the past 10 years showed that companies with a wide economic moat significantly outperformed the market, delivering +645% returns compared to +189% for the S&P 500.

Our research into Economic Moat performance spans the past 10 years and focuses on companies with a wide economic moat. For this analysis, we calculated the average stock price returns of these companies, comparing them to the performance of the S&P 500 index over the same period.

The results were compelling: wide moat stocks achieved a remarkable +645% average return, compared to +188% for the broader market. This difference highlights the long-term benefits of investing in businesses that can maintain their market position and pricing power over time.

Note: This research does not account for survivorship bias. Past performance is not indicative of future results.

Determining whether a company has an economic moat requires both a deep dive into financial metrics and a qualitative assessment of its competitive position. Our analysts conduct a rigorous evaluation that focuses on identifying structural advantages that enable a company to sustain profitability and defend its market share over the long term.

The process begins with an analysis of a company’s historical financial performance. We assess how consistently the company has generated returns above its cost of capital and whether those returns have been stable or improving. However, financial performance alone doesn’t reveal the full picture. To understand the sources of these advantages, we evaluate five key drivers of economic moats:

Network Effect: We analyze whether the value of a company’s product or service grows as its user base expands. Platforms like payment systems or marketplaces benefit from this self-reinforcing.

Switching Costs: We assess whether customers face significant costs or disruptions when switching to a competitor’s product or service. High switching costs create customer stickiness and provide pricing power.

Intangible Assets: Strong brands, patents, and regulatory licenses can protect a company’s market position by creating barriers for competitors or enabling premium pricing. For example, a well-recognized consumer brand may command higher customer loyalty and margins.

Efficient scale: Occurs when a market is optimally served by one or a few players, making it unprofitable for new entrants to compete. This typically happens in industries with high fixed costs or geographic constraints, such as utilities or pipelines.

Cost Advantage: Companies with structural cost advantages can produce goods or services at a lower cost than their competitors, enabling them to offer competitive pricing or maintain higher margins. These advantages often arise from economies of scale, superior supply chain management, or proprietary technology. Firms like Walmart leverage their massive scale to negotiate better terms with suppliers, allowing them to undercut competitors on price.

By examining these factors in combination with a company’s financial performance and market positioning, we classify each company into one of three categories:

This rigorous evaluation ensures that our moat ratings are both comprehensive and reliable, giving investors the tools they need to make well-informed, long-term decisions.

IN		Indian Railway Finance Corp Ltd NSE:IRFC	Add
IN		Power Finance Corporation Ltd NSE:PFC	Add
JP		Shinkin Central Bank TSE:8421	Add
JP		Mitsubishi HC Capital Inc TSE:8593	Add
CA		Element Fleet Management Corp TSX:EFN	Add
IN	I	Indian Renewable Energy Development Agency Ltd NSE:IREDA	Add
TW		Chailease Holding Company Ltd TWSE:5871	Add
IN		Housing and Urban Development Corporation Ltd NSE:HUDCO	Add
JP		Tokyo Century Corp TSE:8439	Add
CN	J	Jiangsu Financial Leasing Co Ltd SSE:600901	Add

IN		Indian Railway Finance Corp Ltd NSE:IRFC	Select
IN		Power Finance Corporation Ltd NSE:PFC	Select
JP		Shinkin Central Bank TSE:8421	Select
JP		Mitsubishi HC Capital Inc TSE:8593	Select
CA		Element Fleet Management Corp TSX:EFN	Select
IN	I	Indian Renewable Energy Development Agency Ltd NSE:IREDA	Select
TW		Chailease Holding Company Ltd TWSE:5871	Select
IN		Housing and Urban Development Corporation Ltd NSE:HUDCO	Select
JP		Tokyo Century Corp TSE:8439	Select
CN	J	Jiangsu Financial Leasing Co Ltd SSE:600901	Select

IN		Indian Railway Finance Corp Ltd NSE:IRFC	Add
IN		Power Finance Corporation Ltd NSE:PFC	Add
JP		Shinkin Central Bank TSE:8421	Add
JP		Mitsubishi HC Capital Inc TSE:8593	Add
CA		Element Fleet Management Corp TSX:EFN	Add
IN	I	Indian Renewable Energy Development Agency Ltd NSE:IREDA	Add
TW		Chailease Holding Company Ltd TWSE:5871	Add
IN		Housing and Urban Development Corporation Ltd NSE:HUDCO	Add
JP		Tokyo Century Corp TSE:8439	Add
CN	J	Jiangsu Financial Leasing Co Ltd SSE:600901	Add

MY	A	Axteria Group Bhd KLSE:AXTERIA	Add
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NL	N	Nepi Rockcastle NV JSE:NRP	Add
US		Schlumberger NV NYSE:SLB	Add
US	B	Baker Hughes Co NASDAQ:BKR	Add
ID		Amman Mineral Internasional Tbk PT IDX:AMMN	Add
US	R	Reddit Inc NYSE:RDDT	Add
CH	G	Galderma Group AG SIX:GALD	Add
US		Halliburton Co NYSE:HAL	Add
LU		Tenaris SA MIL:TEN	Add

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RECLTD

vs

BSE Sensex 30

Stocks Performance
RECLTD vs BSE Sensex 30

Performance Gap
RECLTD vs BSE Sensex 30

Performance By Year
RECLTD vs BSE Sensex 30

Competitors Performance
REC Limited vs Peers

REC Limited
Glance View

Company

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RECLTD vs BSE Sensex 30

Stocks Performance RECLTD vs BSE Sensex 30

Performance Gap RECLTD vs BSE Sensex 30

Performance By Year RECLTD vs BSE Sensex 30

Competitors Performance REC Limited vs Peers

REC Limited Glance View

Company

Help

Tools

Stocks

RECLTD

vs

BSE Sensex 30

Stocks Performance
RECLTD vs BSE Sensex 30

Performance Gap
RECLTD vs BSE Sensex 30

Performance By Year
RECLTD vs BSE Sensex 30

Competitors Performance
REC Limited vs Peers

REC Limited
Glance View