PFC shares zoom out by 7.54%, despite EPS miss by -1.24%

PFC shares revived up to 22% from its recent highs of Rs 580, while the recent highest price target implies a potential upside of 51% from Friday's closing levels. In the September quarter, the disbursals increased by 45% from last year to Rs 47,633 crore. On a sequential basis, disbursals had more than doubled. Brokerage firm CLSA has an "outperform" rating with a price target of Rs 610.

The brokerage said that loan growth for PFC was slow despite the PFC shares reviving by as much as 22% from their recent high of Rs 580. The latest highest price target suggests a potential upside of 51% compared to Friday's closing levels. In the September quarter, PFC's disbursements rose by 45% compared to the previous year, totaling Rs 47,633 crore.

Sequentially, disbursements more than doubled. Brokerage firm CLSA has issued an "outperform" rating with a price target of Rs 610. They noted that while PFC experienced healthy growth in disbursements, loan growth has been slow.

This is largely due to a significant amount of repayments scheduled for the first half of the current financial year. healthy recovery in disbursals as a larger chunk of repayments were scheduled for the first half of the current financial year.

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PFC Financial Result Q2FY25-

Assets Under Management (AUM) grew by 9.8% from last year to Rs 4.93 lakh crore. Asset quality for the quarter improved significantly on a sequential basis. Gross NPA stood at 2.71% from 3.38% in June, while Net NPA stood at 0.72% from 0.87% in June. PFC's board also decided against a loan for the Shapoorji Pallonji Group and around 96% of PFC's infra sanctions are for government entities. A key positive, according to CLSA is PFC starting sanctions in the conventional generation segment.

Shares of PFC are currently trading 8.1% higher at Rs 485.9. The stock is now up 23% so far in 2024. This is the biggest single-day jump seen by the stock since June 3, which was a day before the Lok Sabha Election results were declared.

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Analysts, who had covered state-run Power Finance Corporation (PFC) Ltd. have maintained their "buy" recommendation on the stock, expecting it to test levels as high as Rs 680.

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