PFC Registers ₹66 Billion Net Profit in Q2 FY24, Up 27% YoY

Government-owned Power Finance Corporation (PFC) has recorded a net profit of ₹66.28 billion (~$795.5 million) during the second quarter (Q2) of the financial year (FY) of 2024, a year-over-year (YoY) increase of 26.7%.

The public infrastructure company posted an income of ₹224.04 billion (~$2.69 billion), an increase of 15.9% YoY.

The company recorded ₹219.5 million (~$2.94 million) in dividend income and an additional ₹913.2 million (~$12.26 million) as fees and other income.

During Q2 FY 2024, PFC distributed loans amounting to ₹327.7 billion (~$4.38 billion), reflecting a 91% YoY increase.

Breaking down the disbursements by program, PFC allocated ₹72.8 billion (~$970 million) to generation, marking a YoY decrease of 18.5% from ₹89.42 billion (~$1.19 billion). The transmission sector received ₹2.66 billion (~$35.5 million), a YoY decrease of 74% from ₹10.25 billion (~$136 million)

In the distribution segment, PFC disbursed ₹227.79 billion (~$3.04 billion), a YoY surge of 219% from ₹71.24 billion ($950 million). It allocated ₹24.45 billion (~$326 million) for various miscellaneous programs.

1H FY24

For the year’s first half (1H), the company’s net profit was recorded at ₹ 126 billion (~$1.5 billion), an increase of 28.5% YoY.

The company’s income for the period stood at ₹74.09 billion (~$889 million), an increase of 60% YoY.

For 1H FY24, PFC approved ₹704.99 billion ($8.4 billion) and disbursed ₹315.08 billion ($3.8 billion) under the late payment surcharge program.

PFC has recorded a 2.5-fold increase in disbursements of loans, growing from ₹217.9 billion ($2.6 billion) in 1H FY23 to ₹555.62 billion ($6.7 billion) in 1H FY24. The company attributed this substantial uptick in disbursements to lending in the distribution sector and renewable energy projects.

The company’s gross loan assets for renewable energy generation companies stood at ₹521.26 billion (~$6.2 billion), a YoY increase of 37.2% from ₹379.82 billion (~$4.5 billion). Out of these large hydro projects (>25 MW), loan assets were ₹156.64 billion (~$1.8 billion), a slight decrease of 3% YoY from ₹161.89 billion (~$1.9 billion).

Solar, wind and other renewable energy project loan assets stood at ₹364.62 billion (~$1.8 billion), a YoY increase of 68% from ₹217.03 billion (~$2.6 billion)

Additionally, there has been a 37% increase in the renewable loan book from the first half of 2023.

The Net Non-Performing Asset (NPA) ratio decreased from 1.27% in the first half of 2023 to 0.98% in the first half of 2024. Similarly, the Gross NPA ratio declined from 4.38% in the first half of 2023 to 3.40% in the first half of 2024.

No new additions to NPA have been recorded in the past year. The majority of lending activities have been directed towards the government sector.

PFC supported approximately 25% of India’s installed renewable capacity throughout the specified period and is committed to maintaining this market share. The organization is concentrating on seizing funding opportunities in clean and emerging technologies, including but not limited to energy storage such as batteries and pumped hydro, e-mobility, and green hydrogen.

The consolidated loan asset book crossed ₹9 trillion (~$100 billion) and stood at ₹9.24 trillion (~$110 billion) as of September 30, 2023, increasing by 20% YoY.

To date, the PFC group has cumulatively sanctioned ₹1.24 trillion (~$14.8 billion) and disbursed ₹624.73 billion (~$7.4 billion) under late payment surcharge rules.

The company recorded a 21% increase in consolidated net worth, which stands at ₹1.24 trillion (~$14.8 billion)

In March, PFC inked a project loan agreement with the Japan Bank for International Corporation for a ¥2.6 billion (~$20.2 million) facility. PFC would use the funds under the facility to finance its renewable energy portfolio and provide competitive rates.

The company also approved a loan of ₹6.33 billion (~$77 million) to Gensol Engineering to purchase 5,000 passenger electric vehicles (EVs) and 1,000 cargo EVs to expand its green mobility footprint.

In 2022, PFC disbursed loans of over ₹1.06 trillion (~$12.9 billion), up by 28% YoY. The higher loan disbursements fuelled the company’s robust performance for the year.

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