Power Finance Corporation Ltd (NS:PWFC). (PFC), India’s state-owned powerhouse in the infrastructure lending space, announced an 8.9% year-over-year (YoY) increase in net profit, reaching INR 7,215 crore for Q2 of FY25. This represents a robust jump from INR 6,628.2 crore in the same quarter last year, driven by higher revenue from operations, which rose 15% YoY to INR 25,721.8 crore. On a quarter-to-quarter basis, net profit edged up slightly from INR 7,182 crore in Q1 FY25, showcasing steady growth momentum.
PFC’s operating performance also strengthened, with EBITDA climbing 10.5% YoY to INR 25,354.2 crore. The board has declared a second interim dividend of INR 3.50 per share, a strategic move that reinforces the company’s commitment to maximizing shareholder value. Monday (NASDAQ:MNDY), September 25, 2024, has been set as the record date, with the dividend payout scheduled by December 8, 2024.
Chairperson and Managing Director Parminder Chopra emphasized that shareholder returns remain a top priority, highlighting that PFC’s subsidiary, PFC Infra Finance IFSC, has recently commenced foreign currency lending operations in the GIFT City IFSC in Gujarat. This strategic expansion into international markets marks PFC’s pioneering role in infra financing in this global hub.
Further showcasing PFC’s resilience, Director (Finance) Sandeep Kumar announced that net non-performing assets (NPAs) were successfully reduced to below 1%, reaching a record low of 0.72%. This improvement underscores PFC’s active efforts to resolve stressed assets and demonstrates its commitment to prudent asset management.
For the half-year period ending September 2024, PFC reported a 14% increase in consolidated profit after tax (PAT) at INR 14,397 crore. The company’s consolidated loan asset book expanded by 13% YoY to INR 10,39,472 crore. Additionally, consolidated net worth, including non-controlling interest, surged by 17% to INR 1,45,158 crore.
Reflecting significant asset quality improvement, consolidated net NPA fell to 0.80% for H1 FY25 from 0.98% a year prior, while gross NPA declined by 78 basis points to 2.62%.
With continued momentum in its loan book and stringent asset quality control, PFC is well-positioned to maintain strong performance, aligning growth but valuations remain a concern.
Those who have PFC shares in their portfolio or looking to make a long position might first want to check its fair value in InvestingPro+ to make an optimal entry/exit. And not to forget the ongoing Black Friday Sale allowing heavy discounts of up to 55% on InvestingPro/Pro+!
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