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Informist, Saturday, Mar. 21, 2026

 

 

--PFC source: May prefer local borrow vs overseas amid global turmoil FY27

--PFC source: Large part of FY27 borrow may be via domestic bonds, bk loans

--PFC source: Looking to maintain margins instead of business expansion FY26

 

By Pratiksha and Sagar Sen

 

NEW DELHI – State-owned Power Finance Corp. Ltd. may look to raise more funds domestically rather than borrowing overseas aggressively amid the ongoing geopolitical uncertainties, a senior official from the company said. "Given the geopolitical issues that have come up over the last 15 days, it seems comfortable to raise funds domestically. In the past, we have raised funds through external commercial borrowing and may look to do so again if things settle down," the official told Informist.

 

Geopolitical tensions in West Asia have escalated sharply over the last three weeks, with the US and Israel on one side and Iran on the other. This has led to major central banks across the globe closely watching out for risks to inflation and growth, amid a surge in crude oil prices, and this has shifted the bias of monetary policy towards tightening.

 

The PFC board Tuesday approved borrowing up to INR 1.6 trillion in the next financial year starting Apr. 1. The official said next fiscal a large part of the fund-raising is likely to be through domestic bonds and rupee term loans from banks and financial institutions. However, the company may also look at yen-denominated bonds during the year if the rates are competitive after factoring in hedging cost.

 

As of Dec. 31, the company had outstanding borrowing of INR 4.77 trillion, out of which 56% was from domestic bonds and 20?ch from rupee term loans from banks and financial institutions and foreign currency borrowing.

 

In terms of disbursement, the company may fall short of meeting its internal target of INR 2.25 trillion for FY26, the official said. As of Dec. 31, PFC disbursed INR 1.25 trillion towards various power projects. The official said that the company was not going aggressively after loan book expansion but looking to maintain margins. Till December-end PFC had maintained net interest margin at 3.65%, unchanged from the previous year.

 

On Friday, shares of PFC ended 1% higher at INR 412.85 on the National Stock Exchange. For the December quarter, PFC had reported net profit of INR 47.63 billion on revenue of INR 146.56 billion.  End

 

Edited by Akul Nishant Akhoury

 

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