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Power Finance Corporation has reported 15% decline in the net profit to Rs 1157.26 crore in the quarter ended September 2019 (Q2FY2020) compared with Rs 1366.97 crore in Q2FY2019. The company has maintained stable asset quality, while the company has maintained steady loan growth at 11% end September 2019. Net Interest Income (NII) of the company rose at improved pace of 14% to Rs 2494 crore, while the Net Interest Margin (NIM) rose on sequential basis to 3.13% in Q2FY2020 from 3.06% in the preceding quarter. The interest spreads of the company rose on sequential basis to 2.78% in Q2FY2020 from 2.71% in the preceding quarter.
Performance highlights:
Loan assets of the company increased 11% to Rs 325434 crore at end September 2019 compared to Rs 293083 crore at end September 2018. Within the loan book, the generation loan book moved up 6% to Rs 228644 crore, while transmission loan book moved up 15% to Rs 26693 crore and distribution jumped 25% to Rs 67371 crore at end September 2019.
As per the borrower segment wise classification, the private sector loan book rose 8% to Rs 56648 crore, while the government sector loan book moved up 12% to Rs 268786 crore end September 2019.
Disbursement of the company increased 5% to Rs 18366 crore in Q2FY2020 compared to Rs 17505 crore in Q2FY2019. The generation disbursements moved up 52% to Rs 8712 crore, while transmission disbursements dipped 30% to Rs 1693 crore and distribution disbursements declined 16% to Rs 7758 crore in Q2FY2020.
As per the borrower segment wise classification, the private sector disbursements galloped 45% to Rs 1419 crore, while the government sector disbursements rose 3% to Rs 16947 crore in Q2FY2020.
Outstanding borrowings increased to Rs 282261 crore at end September 2019.
NIM of the company increased 7 bps qoq to 3.13% in Q2FY2020. The yield on assets was steady at 10.60%, while cost of funds dipped 8 bps qoq to 7.82%.
The gross stage 3 asset declined to 9.05% end September 2019 from 9.61% a quarter ago, which entirely relates to private sector exposure. Net stage 3 asset also declined to 4.28% end September 2019 from 4.65% a quarter ago.
Capital Adequacy Ratio stood at 17.35% at end September 2019.
Book value of the company stood at Rs 172.1 per share at end September 2019. Adjusted Book value (net of net stage 3 assets) stood at Rs 119.4 per share at end September 2019.
Financial Performance H1FY2020
For the half year ended September 2019 (H1FY2020), Power Finance Corporation reported 15% increase in Income from Operations at Rs 15521.7 crore, while interest expense increased 17% to Rs 10805.62 crore, leading to a 12% rise in NII to Rs 4688 crore. Other income declined 35% to Rs 85.16 crore. The Gross Profit moved up 6% to Rs 4284.89 crore in H1FY2020. The Depreciation stood at Rs 3.74 crore, while the provisions jumped to Rs 611.87 crore in H1FY2020. The profit before Tax to declined 11% to Rs 3669.28 crore in H1FY2020. An effective rate declined to 30.8% in H1FY2020 from 33.3% in H1FY2019. PAT declined 8% to Rs 2540.02 crore in H1FY2020.
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