10 DALAL STREET INVESTMENT JOURNAL I JULY 10 - 23 , 2017 DSIJ.in^
RecommendationsRecommendations
I
ncorporated on July 16, 1986,
Power Finance Corporation Ltd. is
a Schedule-A Navratna CPSE, and
is a leading non-banking financial
corporation in the country. PFC's
registered office is located at New Delhi
and regional offices are located at
Mumbai and Chennai. PFC vision is to
be the leading institutional partner for
the power and allied infrastructure
sectors in India and overseas across the
value chain.KEY STRENGTHS
PFC is the largest NBFC by net worth
and is a specialised financial institution
in power sector. PFC is a dominant
player with around 20 per cent market
share and is designated as a "Nodal
Agency" for development of Integrated
Power Development Scheme (IPDS),
Ultra Mega Power Projects (UMPPs) and
"Bid Process Coordinator" for Indepen-
dent Transmission Projects (ITPs). An
ISO 9001:2015 certified PFC is a
consistently profit-making and dividend-
paying company with strong asset
quality. PFC enjoys one of the lowest
administrative cost in the industry and(Closing price as of July 04, 2017)Mahanagar Gas 518 985.00 90.
Techno Electric & Engg 217.00 384.00 76.
Rajesh Exports 435 675.00 55.
Quess Corp 616 946.50 53.
Reliance Industries 987 1422.50 44.Name of
CompanyCMP
(`)Best of LAST ONE Year
Reco
Price (`)BANK ON LARGEST NBFC BY NET WORTH
Power Finance Corporation
Total Income 5672.07 7010.17 6928.39 7105.6 6704.
Other Income 125.00 52.91 71.37 53.06 82.
Operating Profit 1237.85 7005.8 6959.01 6957.73 6151.
Interest 4099.44 4293.88 4466.61 4179.69 4179.
Net Profit -3409.49 1949.91 1873.42 1712.55 1259.
Equity 2640.08 2640.08 2640.08 1320.04 1320.Last Five Quarters - Consolidated (`/Cr)
Particulars Mar'17 Dec'16 Sept'16 Jun'16 Mar'CMP
(`)Monthly Stock Market Returns
-20.-15.-10.-5.0.5.10.15.20.25.30.Jul.16Aug.16Sep.16Oct.16Nov.16Dec.16Jan.17Feb.17Mar.17Apr.17May.17Jun.17Jul.BSE Code: 532810
CMP: `122.60 FV: ` 10
BSE Volume: 260027
Date: 04/07/shift from abiding by MoP/GoI ap-
proved norms to the RBI norms, the
company took interest reversals of
`530 crore and provisions of `3430 crore
from the income statement. It was
followed by a 12.5 per cent hike in
GNPAs from `23300 crore to ` 30700
crore and `360 00 crore increase in
restructured advances.The company expects upgradation of
about 80 per cent of GNPAs in FY18, as
these loans include state sector loans
with fuel supply and power purchase
agreements in place. Further, PFC has
done a balance sheet funding in these
projects, supported by escrow mecha-
nism. The company expects loans worth
`18.5 billion to be upgraded by March
2018 in tranches, as the CODs have been
received by the company.There is good loan growth visibility for
the company. Approximately 100 per
cent of the government sector loans and
nearly 20 per cent of private sector loans
are consortium loans.Various initiatives taken by the current
government augurs well for the com-
pany. The recent government initiatives
are :-- 24x7 Power For All (PFA) by 2019
- Amendment in the tariff policy
(January, 2016) - “DEEP” (Discovery of Efficient
Electricity Price) - Ujwal Discom Assurance Yojana
(UDAY) - Deen Dayal Upadhyaya Gram
Jyoti Yojana (DDUGJY)
The growth visibility in loan book and
the benefits that can be derived out of
various government schemes make PFC
a lucrative BUY.Shareholding Pattern
31/03/Promoter 66.
FII 15.
DII 12.
Others 5.
Total 100
boasts of consultancy and advisory
services in strategic, financial, regulatory
and capacity building skills under one
umbrella.FINANCIALS
Power Finance Corporation posted a loss
of `3400 crore in the fourth quarter of
FY17, as the provisions surged in
accordance with the RBI norms. Due to
the rise in provisions as consequence of DSEquity
Gain
(%)HERE IS WHY
Largest NBFC
Specialised financial institution
A consistently profit-making and dividend-
paying company