Companies

Power Finance Corporation Q3 net up 17%

Our Bureau New Delhi | Updated on February 11, 2021

Total income up 16%

Power Finance Corporation posted a consolidated net profit of ₹3,963.18 crore for the October-December quarter of the ongoing financial year, recording a year-on-year growth of 17 per cent.

Total income, which includes subsidiary REC, grew 16 per cent year-on-year to ₹18,441.72 crore for the third quarter.

For the first nine months of the current fiscal, PFC posted a 34.5 per cent year-on-year rise in net profit at ₹11,810.15 crore, and a 16 per cent year-on-year rise in total income at ₹53,545.37 crore.

PFC has not declared a dividend amid increasing pressure from RBI on NBFCs. “RBI at various fora has been stressing the need for maintaining adequate capital buffers for NBFCs. This ideology is also reflecting in the draft guidelines for dividend introduced by RBI and the discussion paper released by RBI on revised regulatory framework for NBFCs. In line with this, PFC is now focusing on capital regulation and shoring up its capital level,” CMD Ravinder Singh Dhillon said on a call with analysts.

“In above backdrop, PFC is in discussion with the government regarding divided declaration. Further we are also awaiting clarity on the implementation of the draft guidelines on dividend issued by RBI for NBFCs,” he added.

Rising demand

Post the lockdown period, the economic activities are gradually resuming. The rising power demand shows pickup in economic activities leading to higher commercial and industrial demand which was affected due to the coronavirus pandemic, PFC said in a statement.

In May last year, during the height of the pandemic, the central government had announced a loan package of ₹90,000 crore to be given out by PFC and REC to cash-strapped, debt-laden electricity distribution companies.

By January, PFC had sanctioned ₹59,067 crore and REC had sanctioned ₹65,932 crore under the liquidity package, the firm said in a statement. This brings the total sanctioned lending under this scheme to ₹1,24.999 crore.

“The group has not experienced any significant impact on its liquidity position due to access to diversified sources of borrowing. The group continues to be well geared to meet its funding needs,” PFC statement said. “It holds sufficient liquidity as well as adequate undrawn lines of credits from various banks. Considering high credit worthiness and well-established relationship of PFC with lenders, it can mobilise sufficient funds from domestic and international markets.”

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Published on February 11, 2021
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