The company has maintained steady Net Interest Margin (NIM) at 3.28% in Q4FY2020 from 3.28% in the preceding quarter. The interest spreads of the company improved to 2.96% in Q4FY2020 from 2.91% in the preceding quarter and was nearly steady from 2.98% in the corresponding quarter last year.

Quarterly performance

The company has posted 9% increase in Income from operations at Rs 8285.26 crore in the quarter ended March 2020. Other income jumped 1612% to Rs 1267.32 core, driven by hefty dividend income. Total income increased 24% to Rs 9552.58 crore in the quarter ended March 2020. The interest expense increased 11% to Rs 5550.32 crore.

The employee expenses were flat at Rs 37.97 crore, while the other expenditures zoomed 417% to Rs 1400.88 crore in the quarter ended March 2020 due to forex losses.

The ensuing Gross Profit stood at Rs 2563.41 crore in the quarter ended March 2020, showing an increase of 6% on yoy basis.

The depreciation during the quarter under review stood at Rs 2.90 crore up from Rs 1.94 crore in Q4FY2019. The provisions jumped to Rs 432.70 crore in Q4FY2020 from write back of Rs 509.66 core in Q4FY2020.

The Profit before Tax declined 27% to Rs 2127.81 crore in the quarter ended March 2020. An effective tax rate was higher at 32.6% in Q4FY2020 compared with 27.4% in Q4FY2019. PAT dipped 32% to Rs 1435.00 crore in Q4FY2020 over Q4FY2019.

Highlights:

Loan assets of the company increased 10% to Rs 344905 crore at end March 2020 compared to Rs 314667 crore at end March 2019. Within the loan book, the generation loan book moved up 6% to Rs 237178 crore, while transmission loan book moved up 14% to Rs 29159 crore and distribution jumped 20% to Rs 75982 crore at end March 2020.

As per the borrower segment wise classification, the private sector loan book rose 7% to Rs 57391 crore, while the government sector loan book moved up 10% to Rs 287514 crore end March 2020.

Disbursement of the company (excluding R-APDRP) declined 8% to Rs 20752 crore in Q4FY2020 compared to Rs 22543 crore in Q4FY2019, as the generation disbursement declined 15% to Rs 8880 crore, while the distribution disbursements fell 6% to Rs 8710 crore in Q4FY2020. However, transmission disbursements moved up 6% to Rs 2911 crore.

As per the borrower segment wise classification, the private sector disbursements jumped 50% to Rs 2491 crore, while the government sector disbursements fell 13% to Rs 18261 crore in Q4FY2020.

Outstanding Borrowings increased by 10% to Rs 303453 crore at end March 2020, driven by bonds borrowing rising 11% to Rs 244316 crore at end March 2020. Term loans moved up 24% to Rs 57099 crore, while short-term loans dipped 80% to Rs 2038 crore at end March 2020.

NIM of the company declined 18 bps yoy to 3.28% in Q4FY2020. The yield on assets rose 1 bps to 10.67%, while cost of funds moved up 3 bps yoy to 7.71%.

The gross stage 3 asset declined to 8.08% end March 2020 from 8.34% a quarter ago, which entirely related to private sector exposure. Net stage 3 asset also declined to 3.80% end March 2020 from 3.94% a quarter ago.

Capital Adequacy Ratio stood at 16.96% at end March 2020 compared to 17.09% a year earlier.

Book value of the company stood at Rs 171.1 per share at end March 2020. Adjusted Book value (net of net stage 3 assets) stood at Rs 121.4 per share at end March 2020.

Financial Performance FY2020

For the year ended March 2020 (FY2020), Power Finance Corporation reported 12% increase in Income from Operations at Rs 31950.42 crore, while interest expense increased 15% to Rs 21853.19 crore, leading to a 10% rise in NII to Rs 7307 crore. Other income increased 326% to Rs 1420.64 crore. The Staff cost fell 2% to Rs 173.57 crore, while the other expenditure increased 8% to Rs 654.67 crore. The ensuing Gross Profit moved up 3% to Rs 9192.86 crore in FY2020. The Depreciation stood at Rs 9.10 crore, while provisions increased to Rs 991.22 crore in FY2020. The profit before Tax to declined 17% to Rs 8192.54 crore in FY2020. The tax expense declined 11% to Rs 2537.40 crore. PAT fell 19% to Rs 5655.14 crore in FY2020.