Non-banking finance firm Power Finance Corporation records 49% jump in net profits in FY21

Non-banking finance firm Power Finance Corporation records 49% jump in net profits in FY21
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State-owned non-banking finance firm Power Finance Corporation (PFC) has recorded the highest-ever net profit of ₹8,444 crore for financial year 2020-21, a 49 percent jump over the previous year.

In FY20, the PFC had reported a net profit of ₹5,655 crore on a standalone basis.

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The company's consolidated net profit also increased by 66 per cent in FY21 to ₹15,716 crore against ₹9,477 crore reported in FY20.

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During 2020-21, the power sector lender increased its net interest income to ₹12,951 crore in compassion to ₹10,097 crore reported in FY 20.

The company declared dividend of ₹2 per share which takes up its total dividend distribution in FY 21 of ₹10 per share i.e. 100 per cent.

Aided by profit growth, PFC's net worth for FY21 also increased by 16 per cent to ₹52,393 crore.

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Unlike commercial banks, PFC's Gross NPA ratio saw a sharp reduction of 238 bps from FY20. The current GNPA ratio is at 5.70 per cent against 8.08 per cent in FY20

Net NPA ratio also saw a sharp reduction of 171 bps from FY20. The current Net NPA ratio is at 2.09 per cent against 3.80 per cent in FY20.

The lender said that 25 percent of its 'stressed book' got resolved in FY 21.

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The capital adequacy ratio of the company has also improved sequentially to 18.83 per cent as on March 31, 2021. The capital adequacy is at a comfortable level with sufficient cushion over & above the prescribed regulatory limits.

Under the Aatma Nirbhar Discoms liquidity support announced by the government, PFC & its subsidiary REC, combined together have so far sanctioned ₹1,34,782 crore and disbursed ₹78,855 crore.

"I am extremely pleased with our FY 21 results despite the many headwinds faced during the year. The impressive performance in FY 21 as is evident from the highest ever profit, underlines the inherent strengths of PFC in handling adverse economic events. Going forward also, we are committed to deliver long-term value to our shareholders," Chairman and Managing Director R.S. Dhillon said.

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