Power Finance Corporation Ltd. (PFC) is a leading infrastructure finance company in India. It is a Schedule-A Maharatna CPSE under the administrative control of the Ministry of Power. PFC was established in 1986 with the objective of providing finance to the power sector. Over the years, PFC has diversified its portfolio to include other infrastructure sectors such as oil and gas, renewable energy, telecommunications, and transportation.
PFC is a leading financier of the Indian power sector. It has provided financial assistance to over 1,000 power projects, with a total loan exposure of over Rs. 6 lakh crore. PFC is also a major player in the renewable energy sector, with a portfolio of over 50 GW of renewable energy projects.
PFC Overview
| Attribute | Value |
|---|---|
| Company Name | Power Finance Corporation Ltd. (PFC) |
| Sector | Infrastructure Finance |
| Ministry | Ministry of Power |
| Established | 1986 |
| Headquarters | New Delhi, India |
PFC Products
| Product Category | Product Name | Description |
|---|---|---|
| Fund Based Policies | Term Loans | Long-term loans to finance the capital expenditure of infrastructure projects. |
| Project Finance | Structured finance solutions for greenfield and brownfield projects. | |
| Working Capital Finance | Working capital finance to meet the day-to-day operational requirements of infrastructure projects. | |
| Non-Fund Based Policies | Letters of Credit (LCs) | Guarantees to secure the performance of financial obligations. |
| Bank Guarantees | Guarantees to secure the performance of contractual obligations. | |
| Standby Letters of Credit (SBLCs) | Guarantees to secure the payment obligations of issuers. |
PFC Awards and Recognition
| Award Name | Year | Awarding Organization |
|---|---|---|
| ICAI Award for Excellence in Financial Reporting | 2020-21 | Institute of Chartered Accountants of India (ICAI) |
| North India Best Employer Brand Award | 2021 | CMO Asia |
| Industry Excellence Award | 2021 | ABP News |
| NDMC’s Swachhta Award | 2021 | New Delhi Municipal Council (NDMC) |
| SCOPE Meritorious Award | 2021 | Standing Conference of Public Enterprises (SCOPE) |
| SKOCH Gold Award | 2021 | SKOCH Group |
| Certificate of Appreciation | 2021 | Government of Haryana |
| National CSR Award | 2020 | Ficci CSR Awards |
| Governance Now PSU Award | 2019 | Governance Now |
| Golden Peacock Award for Corporate Social Responsibility | 2019 | Institute of Directors (IOD) |
PFC Fundamentals
| Financial Metric | Value |
|---|---|
| Market Capitalization (Cr) | 110520.00 |
| Revenue (Cr) | 20230.63 |
| EBITDA (Cr) | 7337.52 |
| EPS (Cr) | 10.49 |
| P/E Ratio | 11.37 |
| P/B Ratio | 1.19 |
| Dividend Yield (%) | 3.32 |
| Debt/Equity Ratio | 1.31 |
| Book Value (Cr) | 93.21 |
| Face Value (Cr) | 10.00 |
| ROE (%) | 20.20 |
| Debt (Cr) | 52741.24 |
PFC Revenue and Net Profit
| Year | Revenue (Cr) | Net Profit (Cr) |
|---|---|---|
| 2022 | 18,449.74 | 5,709.06 |
| 2023 | 20,230.63 | 6,485.71 |
PFC Shareholding Patterns
| Shareholder Category | Percentage of Shares Held |
|---|---|
| Promoter Group | 55.99% |
| Foreign Institutional Investors (FIIs) | 26.17% |
| Domestic Institutional Investors (DIIs) | 14.01% |
| Mutual Funds | 4.67% |
| Others | 3.16% |
| Total | 100.00% |
PFC Share Price Target for 2024, 2025, 2026, 2027, 2028
| Year | Share Price Target (INR) |
|---|---|
| 2024 | 400 |
| 2025 | 450 |
| 2026 | 500 |
| 2027 | 550 |
| 2028 | 600 |
PFC Share Price Target for 2024
The Share price target for 2024 is 400.
PFC Share Price Target for 2025
The share price target for 2025 is 450.
PFC Share Price Target for 2026
The share price target for 2026 is 500.
PFC Share Price Target for 2027
The share price target for 2027 is 550.
PFC Share Price Target for 2028
The share price target for 2028 is 600,
PFC Dividend History
| Year | Dividend per Share (INR) | Dividend Yield (%) |
|---|---|---|
| 2020 | 4.50 | 3.22 |
| 2021 | 4.75 | 3.32 |
| 2022 | 5.25 | 3.50 |
Future Outlook of PFC
The future outlook for Power Finance Corporation Ltd. (PFC) is positive, driven by several factors, including:
-
Strong growth in the Indian power sector: India’s power consumption is expected to grow at a CAGR of 5-6% over the next decade, driven by factors such as urbanization, rising incomes, and increasing industrialization. This will create a strong demand for PFC’s financing services.
-
Diversification into renewable energy: PFC is diversifying its portfolio into renewable energy, which is a high-growth sector in India. The government has set a target of 500 GW of renewable energy capacity by 2030, and PFC is well-positioned to finance these projects.
-
Strong financial performance: PFC has a strong track record of profitability and a healthy balance sheet. It is also a highly rated company, with a credit rating of AAA from CRISIL and CARE.
-
Government support: PFC is a Schedule-A Maharatna CPSE under the administrative control of the Ministry of Power. This means that it receives strong support from the government, which could help it to secure new projects and financing opportunities.
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Risks Associated With Investing in PFC
| Risks | Description |
|---|---|
| Competition from other financial institutions | PFC faces competition from other financial institutions, such as banks and non-banking financial companies (NBFCs). This competition could put pressure on PFC’s margins. |
| Rising interest rates | Rising interest rates could increase PFC’s cost of funds, which could put pressure on its profitability. |
| Regulatory changes | The Indian government is considering a number of regulatory changes that could impact the power sector, such as changes to the tariff policy and the renewable energy purchase obligation (RPO). These changes could have an impact on PFC’s business. |
| Economic slowdown | An economic slowdown could reduce demand for power, which could negatively impact PFC’s business. |
| Credit risk | PFC is exposed to credit risk, which is the risk that borrowers will not be able to repay their loans. This risk could be exacerbated by an economic slowdown. |
| Operational risk | PFC is also exposed to operational risk, which is the risk of loss due to inadequate or failed internal processes, people, or systems or from external events. |
| Market risk | PFC is exposed to market risk, which is the risk of loss due to changes in market prices. This risk could be exacerbated by volatile market conditions. |
PFC Competitors
| Competitor | Description |
|---|---|
| Bajaj Finance Ltd. | A non-banking financial company (NBFC) that offers a wide range of financial products and services, including loans, investments, and insurance. |
| Indian Railway Finance Corporation Ltd. | A public sector finance company that provides financial assistance for the development and expansion of the Indian Railways. |
| Cholamandalam Investment & Finance Company Ltd. | A non-banking financial company (NBFC) that offers a wide range of financial products and services, including loans, investments, and insurance. |
| REC Ltd. | A public sector finance company that provides financial assistance for the development and expansion of the power sector in India. |
PFC Share Price FAQs
What has been the historical share price trend of PFC?
The share price of PFC has been on an upward trend in recent years. In the past five years, the share price has increased by over 200%.
What is the outlook for PFC’s share price?
Analysts are generally positive on the outlook for PFC’s share price. The consensus estimate is that the share price could reach ₹300-350 in the next 3-5 years.
Is PFC a good investment?
PFC is a relatively risky investment, but it also has the potential for high returns. Investors should carefully consider their own investment goals and risk tolerance before making an investment decision.
DISCLAMER: We are not SEBI registered. We have not provided any real investment advice or stock recommendations. The share price targets and justifications in this article are hypothetical examples for educational purposes only. Stock prices depend on many factors and future returns are not guaranteed. Readers should do their own research before investing. Or consult a registered financial advisor for guidance. We do not guarantee any stock performance or returns. Investing in stocks involves risks.
