PFC Q4 profit jumps 23 pc to Rs 7,556 cr; expects stable loan growth in FY25

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Mumbai, May 15 (PTI) State-owned energy and infra lender Power Finance Corporation (PFC) on Wednesday reported 23 per cent jump in March quarter consolidated net profit at Rs 7,556 crore on core income growth.


On standalone basis, profit grew to Rs 4,549 crore from Rs 3,695 crore. In 2023-24, consolidated net profit increased to Rs 26,461 crore from the year-ago's Rs 21,179 crore.

Chairman and Managing Director Parminder Chopra told reporters that the company witnessed 14 per cent growth in the loan book in FY24, and will be aiming for a loan growth of 12-15 per cent in FY25.

The company borrowed nearly Rs 1 lakh crore in FY24 including about 18 per cent of foreign borrowings, which will go up to Rs 1-1.25 lakh crore in FY25 with the loan growth, Chopra said, adding that PFC aspires to keep the overseas component limited between 15-20 per cent.


Renewable energy and power distribution will be the key contributors of the loan book growth going forward, Chopra said, specifying that renewable grew 25 per cent in FY24 while 40 per cent of the incremental loans in FY24 came from the distribution front.

In the March quarter, its core net interest income grew 25 per cent to Rs 8,739 crore, aiding the profit growth. Widening of the net interest margin to 3.46 per cent in FY24 versus 3.36 per cent in FY23, along with the 14 per cent loan book growth helped the number.

Chopra said there were no new additions to non-performing assets (NPA) in FY24, and gross NPA ratio improved to 3.34 per cent as against 3.91 per cent a year ago.


She said the resolution of two specific assets worth over Rs 2,900 crore which are in advanced stages of resolution will take the GNPA ratio to under 3 per cent.

The two assets include a Rs 2,400 crore exposure to Lanco's Amarkantak project which is being resolved through the bankruptcy courts, she said, adding that it has a 76 per cent provision on the exposure which is expected to get a 35 per cent principal.

Total 21 projects with an underlying exposure of Rs 16,000 crore are classified as stressed by the company and Chopra said 13 of them with an exposure of Rs 14,000 crore are being resolved through the bankruptcy courts.


Asked about RBI's recent proposals on the project finance front, Chopra said they will not impact the profitability but the higher provisions for assets may require money to be allocated as an impairment reserve, which will have an impact on the capital adequacy.

The overall capital adequacy stood at a comfortable 25.41 per cent as on March 31, 2024 as against 24.37 per cent in FY23.

The company's newly established arm in GIFT City, designed to help local companies borrow in international currencies and also for strategically important neighbouring countries, is yet to get commencement certificate, Chopra said, adding that a seed capital of Rs 100 crore has been allocated towards it.


She also made it clear that despite the energy transition, there will be a demand from thermal projects from an energy security perspective and the company will continue serving the segment.

She added that at present, PFC's overall market share is 50 per cent in the number of energy projects and it aims to maintain the same going forward.

The overall pipeline of loans was classified as healthy by company officials, who pointed out that last year, it sanctioned over Rs 2.68 lakh crore of loans, which typically takes over 2 years to get disbursed.

The company's board recommended a final dividend of Rs 2.5 per share, which takes the overall payout to Rs 13.5 per share.

The PFC scrip closed 3.56 per cent up at Rs 436.55 on the BSE on Wednesday, as against a 0.16 per cent correction on the benchmark. PTI AA ANU ANU