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Cover Story | August 2014

Power 20:20 | Power Finance Corporation (PFC)

Most Innovative Power Company (Finance) : Power Finance Corporation (PFC)

PFC was set up in 1986 as a financial institution dedicated to power sector financing and committed to the integrated development of the power & associated sectors. PFC is a Navratna Company and the largest NBFC in India was incorporated with an objective to provide financial resources and encourage flow of investments to the power and associated sectors, to work as a catalyst to bring about institutional improvements in streamlining the functions of its borrowers in financial, technical and managerial areas, to ensure optimum utilisation of available resources and to mobilise various resources from domestic and international sources at competitive rates.

Key Success Factors

  • Healthy Financials: PFC´s loan asset growth was up by 18 per cent to Rs 1.90 lakh crore from Rs 1.60 lakh crore. Despite the volatile interest rates and forex markets, the company has managed to keep cost of borrowings competitive during the year. The company has raised about Rs 45,000 crore during the year at a marginal cost of 8.96 per cent which includes Rs 5,000 crore of tax-free bonds. The company´s gross NPA levels have come down to 0.65 per cent from 0.71 per cent last year and net NPAs have come down to 0.52 per cent from 0.63 per cent last year.
  • Profitability: PFC is the youngest among the top ten profit making PSUs in the country, the company´s profit in 2013-14 was Rs 5,461 crore which was 23 per cent higher than 2012-13. The total income of the company with an increase of 24 per cent was Rs 21,614 crore.
  • Ratings: During FY 2013-14, international credit rating agencies Moody´s, Fitch and Standard & Poor´s have given long term currency issuer ratings of Baa3, BBB- & BBB- respectively. In terms of domestic ratings the company´s long term domestic borrowing programme was awarded the highest rating of AAA by CRISIL & ICRA respectively, whereas the short term borrowing programme (including bank loans) was awarded the highest rating of A1+ by CRISIL & ICRA respectively.
  • Power Finance Corporation is under the process of selecting a developer through international bids for three coal blocks.
  • Loan sanctions of Rs 61,000 crore during FY14 against target of Rs 59,000 crore.
  • Disbursed Rs 47,162 crore against target of Rs 47,000 crore during FY14.
  • Outstanding loan sanctions of Rs 1.56 lakh crore in FY14.

Key financials
PFC has had a rapid growth and outstanding financial records :

  • Total revenue in FY 2013-14 has crossed Rs 21,000 crore as against Rs 17,260 crore.
  • The net profit has increased to Rs 5,461 crore in 2013-14 as against Rs 4,419 crore in FY 2012-13.
  • he total consolidated net worth of the company as on 31st March 2013 stood at Rs Rs 22, 351 crore as against Rs 19,493 crores in 2012.
  • Loan sanctions of Rs 61,000 crore during FY14 against target of Rs 59,000 crore.
  • Disbursed Rs 47,162 crore against target of Rs 47,000 crore during FY14.
  • Outstanding loan sanctions of Rs 1.56 lakh crore in FY14.
Parameter Details
Company PFC Limited
Ownership State-owned-enterprise
Industry Financial Services
Founded 1986
Headquarters New Delhi, India
Products Rupee Term Loan,
Foreign Currency Loan,
Short Term Loan
Services Financial Consulting,
Financial Products,
Investment Banking,
Loan Management,
Linkage Management
Revenue Rs. 21,614 cr
Net Income Rs. 5,461 cr
Employees 350

Key financial parameters FY 2013-14 FY 2012-13
Income Rs. 21,614 cr Rs. 17,260 cr
Expenditure Rs. 14,004 cr Rs. 11,305 cr
Operating profit NA Rs. 5,954 cr
Interest Rs. 13,756 cr Rs. 11,160 cr
Depreciation Rs. 5.23 cr Rs. 5.7 cr
PAT Rs. 5,461 cr Rs. 4,419 cr
EPS Rs. 41.38 Rs. 33.48
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