PFC follow-on offer opens; should you subscribe?

The follow-on-public offer (FPO) of Power Finance Corporation (PFC) - leading financial institution in India focused on the power sector - has opened for subscription.

PFC offers more than 22.95 crore equity shares through the public offer and provided 5% discount to retail bidders & eligible employees.

Bids can be made for 28 equity shares and in multiple of 28 shares thereafter. The issue will close on May 12 for qualified institutional bidders and May 13 for all other bidders.

Experts as well as brokerage houses believe that the company looks good with long term perspective. Investment Advisor SP Tulsian and Portfolio Manager, PN Vijay advised PFC for long term.

"FPO is attractive only from the medium term point of view, as current share price near its 52-week low, without much excitement on listing gains for HNIs, while a nominal single digit listing gain may accrue to retail investors, thanks to the 5% discount offered to them," Tulsian said.

Portfolio Manager PN Vijay said, "PFC is a good company. If people were to roll back to the REC FPO which is a similar financing of the power sector infrastructure, it did pretty well in the aftermarket unlike some of the other FPOs. I don