Buy PFC; target of Rs 321: Firstcall Research

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26 Aug, 2025 12:21

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Firstcall Research report on Power Finance Corporation“Power Finance Corporation Ltd (PFC) was set up on 16th July 1986 as a public limited company and was granted certification of commencement of business on Dec 31st, 1987. The Corporation was notified as a Public Financial Institution in 1990 under Companies Act, 1956. PFC is a leading power sector public financial institution and a non-banking financial company in India, provides affordable and competitive products and services with efficient and internationally integrated sourcing and servicing, partnering the reforms in the Indian Power Sector and enhancing value to its stakeholders; by promoting efficient investments in the power and allied sectors in India and abroad. PFC was incorporated with an objective to provide financial resources and encourage flow of investments to the power and associated sectors, to work as a catalyst to bring about institutional improvements in streamlining the functions of its borrowers in financial, technical and managerial areas to ensure optimum utilization of available resources and to mobilize various resources from domestic and international sources at competitive rates. PFC, which has entered its Silver Jubilee Year in 2010, is a Schedule-A, Nav-Ratna CPSE (conferred by Govt. of India on 22nd June, 2007) in the Financial Service Sector, under the administrative control of the Ministry of Power. Its Registered and Corporate Offices are at New Delhi.” “At the current market price of Rs. 281.75, the stock P/E ratio is at 5.91 x FY15E and 5.20 x FY16E respectively. Earning per share (EPS) of the company for the earnings for FY15E and FY16E is seen at Rs.47.69 Rs.54.14 respectively. Net Sales and PAT of the company are expected to grow at a CAGR of 20% and 17% over 2013 to 2016E respectively. On the basis of EV/EBITDA, the stock trades at 7.20 x for FY15E and 6.44 x for FY16E. Price to Book Value of the stock is expected to be at 1.17 x and 1.01 x respectively for FY15E and FY16E. We recommend ‘BUY’ in this particular scrip with a target price of Rs.321.00 for Medium to Long term investment,” says Firstcall Research report.    

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