PFC shares soar 6% after net profit rises 20% YoY. Should you invest?
Power Finance Corporation (PFC) rose 6% to a day’s high of Rs 501.65 on the BSE after the company reported a more than 20% increase in consolidated net profit to Rs 7,182 crore for the June 2024 quarter.
Total income for the quarter grew to Rs 24,736.68 crore, up from Rs 21,017.81 crore in the same period last year.
Here is what brokerages have said:
Bernstein: Outperform | Target price: Rs 650
Bernstein has maintained an Outperform rating with a target price of Rs 620.
Q1 FY25 was a disappointing quarter, marked by a decline in the loan book quarter-on-quarter. Despite this, guidance on growth was retained. Bernstein remains confident in future loan book growth, viewing this quarter as a temporary setback. Visibility on the reversal of provisions is improving, bolstered by a favorable bid for the KSK plant.
Phillip Capital: Buy| Target price: Rs 590
Domestic brokerage Phillip Capital maintained a buy rating on PFC with a target price of Rs 590.
The company’s loan growth was subdued as PFC realigned its loan processing systems and built capacity for its infrastructure business. It remains hopeful of meeting its loan growth guidance of 14% for FY25, implying accelerated growth in the remaining quarters. Stability in Net Interest Margin (NIM) and potential recovery from stressed assets are expected to be key drivers of earnings.
(Disclaimer: Recommendations, suggestions, views, and opinions given by the experts are their own. These do not represent the views of The Economic Times)
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