The company has showed moderation in Net Interest Margin (NIM) to 3.30% in Q4FY2021 from 3.63% in Q3FY2021. The interest spreads of the company eased to 3.03% in Q4FY2021 from 3.20% in the preceding quarter, while rose from 2.96% in the corresponding quarter last year.

Quarterly performance

The company has posted 7% increase in Income from operations at Rs 8875.66 crore in the quarter ended March 2021. Other income declined 37% to Rs 798.76 crore. Total income increased 1% to Rs 9674.42 crore in the quarter ended March 2021. The interest expense increased 5% to Rs 5803.78 crore.

The employee expenses moved up 15% to Rs 43.81 crore, while the other expenditures dipped 83% to Rs 236.36 crore in the quarter ended March 2021.

The ensuing Gross Profit stood at Rs 3590.47 crore in the quarter ended March 2021, showing an increase of 40% on yoy basis.

The depreciation during the quarter under review stood at Rs 3.67 crore up from Rs 2.90 crore in Q4FY2020.

The Profit before Tax galloped 31% to Rs 2793.82 crore in the quarter ended March 2021. An effective tax rate was lower at 16.7% in Q4FY2021 compared with 32.6% in Q4FY2020. PAT increased 62% to Rs 2326.61 crore in Q4FY2021 over Q4FY2020.

Highlights:

Loan assets of the company increased 7% to Rs 370771 crore at end March 2021 compared to Rs 344905 crore at end March 2020.

Within the loan book, the generation loan book declined 4% to Rs 227052 crore, while transmission loan book moved up 1% to Rs 29345 crore and distribution jumped 48% to Rs 112299 crore at end March 2021.

As per the borrower segment wise classification, the private sector loan book rose 3% to Rs 59384 crore, while the government sector loan book jumped 8% to Rs 311387 crore end March 2021.

Disbursement of the company jumped 37% to Rs 28357 crore in Q4FY2021 compared to Rs 20752 crore in Q4FY2020, as the distribution disbursements jumped 116% to Rs 18784 crore in Q4FY2021. However, the generation disbursement declined 8% to Rs 8193 crore and transmission disbursements also fell 54% to Rs 1351 crore.

As per the borrower segment wise classification, the private sector disbursements rose 11% to Rs 2766 crore, while the government sector disbursements increased 40% to Rs 25591 crore in Q4FY2021.

Outstanding borrowings increased by 7% to Rs 325095 crore at end March 2021, driven by bonds borrowing rising 7% to Rs 260233 crore at end March 2021. Term loans rose 7% to Rs 61099 crore, while short-term loans jumped 85% to Rs 3763 crore at end March 2021.

NIM of the company rose 2 bps yoy to 3.30% in Q4FY2021. The yield on assets eased 39 bps to 10.28%, while cost of funds dipped 46 bps yoy to 7.25%.

The gross stage 3 asset declined to 5.70% end March 2021 from 5.85% a quarter ago, which entirely related to private sector exposure. Net stage 3 asset also declined to 2.09% end March 2021 from 2.30% a quarter ago.

Capital Adequacy Ratio stood at 18.83% at end March 2021 compared to 16.96% a year earlier.

Book value of the company stood at Rs 198.45 per share at end March 2021. Adjusted Book value (net of net stage 3 assets) stood at Rs 169.16 per share at end March 2021.

Financial Performance FY2021

For year ended March 2021 (FY2021), Power Finance Corporation reported 13% increase in Income from Operations at Rs 36145.76 crore, while interest expense increased 6% to Rs 23194.49 crore, leading to a 28% rise in NII to Rs 12951.27 crore. Other income increased 14% to Rs 1620.81 crore. The staff cost was flat at Rs 194.62 crore, while the other expenditure declined 69% to Rs 662.58 crore. The ensuing Gross Profit moved up 49% to Rs 13714.88 crore in FY2021. The Depreciation stood at Rs 11.17 crore, while provisions increased 253% to Rs 3496.40 crore in FY2021. The profit before Tax increased 25% to Rs 10207.31 crore in FY2021. The Tax expense dipped 31% to Rs 1763.30 crore. PAT improved 49% to Rs 8444.01 crore in FY2021.