PFC Q2 net profit seen down 41% at Rs 411 cr

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PFC Q2 net profit seen down 41% at Rs 411 cr

Power Finance Corporation (PFC), a lender to power projects, is expected to report a profit after tax of Rs 411 crore in the second quarter of FY12, a fall of 41% as compared to Rs 700 crore in the corresponding quarter of last fiscal.

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Power Finance Corporation (PFC), a lender to power projects, is expected to report a profit after tax of Rs 411 crore in the second quarter of FY12, a fall of 41% as compared to Rs 700 crore in the corresponding quarter of last fiscal.

Net interest income is seen going up 14% to Rs 1,021.6 crore from Rs 896 crore during the same period.

Expectations

·          Loan growth expected to remain healthy at 24%

·          PAT decline due to MTM losses

·          Due to rupee depreciation, and only 14% of its foreign currency borrowings being fully hedged, there could be higher MTM losses

·          Motilal Oswal factors in Rs 350 crore of MTM losses

·          Asset quality & provisions expected to be stable

·          Watch out for:
o         Issues pertaining to SEBs
o         Guidance on growth & asset quality
o         MTM losses on foreign currency borrowings
o         Spreads movement