Power Finance Q1 Review - Stable Stage-III Assets, Improved Coverage, Consistent Spreads: ICICI Securities
Electrical power lines hang from a transmission pylons alongside a road in Mumbai. (Photographer: Dhiraj Singh/Bloomberg)

Power Finance Q1 Review - Stable Stage-III Assets, Improved Coverage, Consistent Spreads: ICICI Securities

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ICICI Securities Report

Power Finance Corporation Ltd. has reported Q1 FY22 profit after tax of Rs 22.7 billion much higher than our expectations.

Net interest income grew 15% YoY as well as QoQ as against our expectations of pressure on net interest margin due to cut in lending rates with-effect-from April 2021.

Yields surprisingly improved QoQ and spreads were sustained at 3%.

This has more than offset credit cost provisioning of Rs 4.5 billion and forex mark to margin loss of Rs 2.7 billion.

Stage-III assets remained stable at Rs 211.5 billion (5.7%) and a couple of projects are in advances stages of resolution.

For the first time, Power Finance Corporation announced an interim dividend in Q1 itself (of Rs 2.25 per share).

Click on the attachment to read the full report:

ICICI Securities PFC Q1FY22 Results Update.pdf

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