Power Finance Corporation Limited · NSE:PFC
Power Finance — Q3 FY2020 Earnings Presentation
34 slides from Power Finance's earnings presentation, February 2020
Slide 1: Performance Highlights
Power Finance Corporation Ltd. Performance Highlights A Navratna PSU Quarter ended 31st December 2019 Funding for a righter Tomorrow
Slide 2: Table of Contents
Table of Contents A Consolidated Performance B Stand Alone Performance 01 PFC at a Glance 01 Highlights 02 Earning Update 02 Earning Update 03 Operational Performance 03 Asset Quality 04 Operational Performance 05 Shareholder Outlook
Slide 3: A. Consolidated Performance
3 A. Consolidated Performance
Slide 4: PFC at a Glance
4 1 PFC at a Glance
Slide 5: PFC Group Structure
5 PFC Group Structure Power Finance Corporation ASSOCIATES SUBSIDIARIES JOINT VENTURE 24.97% Ultra Mega 22.18% PFC Consulting EESL Power Projects REC 100% 100% 47.14% 52.63% 1. EESL – Energy Efficiency Service Ltd. 2. 47.15% stake in EESL is consolidated stake of PFC (24.97%) & REC (22.18%)
Slide 6: Earning Update
6 2 Earning Update
Slide 7: Key Consolidated Financials
7 Key Consolidated Financials TOTAL INCOME - Rs.46,021 cr.. 9M 20 PAT- Rs.8,784 cr. PFC LOAN ASSET - Rs.6,40,387 cr. CRAR – 18.12% Consolidated for 9M’20 Gross NPA- 7.41% NET NPA - 3.56% Note: Dividend of Rs.1,143 cr. approx. from REC ltd. to PFC will be reflected in next quarter i.e. Q4’20. .
Slide 8: Key Consolidated Financials
8 Key Consolidated Financials (Rs.’crore) Q3 FY 20 Q2 FY 20 Q3 FY 19 9M FY 20 9M FY 19 Interest Income 15,679 15,397 13,884 45,586 39,245 Interest Expense 10,262 10,153 8,871 30,352 25,481 Net Interest Income 5,417 5,244 5,013 15,234 13,764 Profit After Tax 3,387 2,497 3,876 8,784 9,249 Total Compre
Slide 9: Operational Performance
9 3 Operational Performance
Slide 10: Operational Performance – 9M'20
10 Operational Performance – 9M’20 Loan Asset Book of Rs.6,40,387 cr. Rs.1,00,708 cr. Disbursement for 9M’20 Others Others 1% 2% Generation (Conventional) T&D 39% 40% Loan Assets as Disbursements Generation for 9M’20 on (Conventional) T&D 31.12.2019 54% 49% Renewable Renewable 10%1 5%1 PFC Group is
Slide 11: B. Stand Alone Performance
11 B. Stand Alone Performance
Slide 12: Highlights
12 1 Highlights
Slide 13: Resilient Performance in Q3/9M'20
13 Resilient Performance in Q3/9M’20 Q3 Net Profit at Rs.1,680 cr. 45% Jump from Q2’20 19.32% CRAR with Tier I at 14.37% CRAR at pre-acquisition level OTS against PFC Loan of Rs1,720 cr. Rattan India Amravati Resolved
Slide 14: Stable Financial Indicators for Q3'20
14 Stable Financial Indicators for Q3’20 Yield at 10.66% Cost at 7.75%% Spread at 2.91% 10.66% 2.91% 10.61% 10.60% 7.90% 2.78% 7.82% 7.75% 2.71% Q1'20 Q2'20 Q3'20 Q1'20 Q2'20 Q3'20 Q1'20 Q2'20 Q3'20 Maintaining a Stable Yield on Well managed cost of funds – Improving spread in a challenging Earning
Slide 15: Resolution Efforts Yielding Results
15 Resolution Efforts Yielding Results Net Stage III Assets at 3.94% Net Stage III Assets lowest in last 2 years 7.39% Gross Stage III Assets at 4.55% 4.65% 8.34% from 9.47% in 9M’19 4.28% 3.94% Rs.2,650 cr. of stressed assets FY 17-18 FY 18-19 Q1'20 Q2'20 Q3'20 resolved in last 9 months
Slide 16: Earning Update
16 2 Earning Update
Slide 17: Revenue & Growth
17 Revenue & Growth (Rs.’crore) Q3 FY 20 Q2 FY 20 Q3 FY 19 9M FY 20 9M FY 19 Interest Income 8,149 8,004 7,262 23,697 20,813 Interest Expense 5,530 5,510 4,815 16,390 14,188 Net Interest 2,619 2,494 2,447 7,307 6,625 Income Profit After Tax1&2 1,680 1,157 2,084 4,220 4,835 Cumulative Provisions 15,4
Slide 18: Key Ratios
18 Key Ratios (Ratios in %) Q3 FY 20 Q2 FY 20 Q3 FY 19 9M FY 20 9M FY 19 Yield on Earning 10.66 10.60 10.65 10.61 10.58 Assets Cost of Funds 7.75 7.82 7.97 7.82 8.04 Interest Spread on 2.91 2.78 2.68 2.79 2.54 Earning Assets Net Interest Margin on 3.28 3.13 3.42 3.14 3.32 Earning Assets Net worth (S
Slide 19: Asset Quality
19 3 Asset Quality
Slide 20: Asset Quality Snapshot
20 Asset Quality Snapshot Loan Book of Rs.3,32,962 cr. as on 31.12.2019 Private Rs.2,77,744 cr. Govt. Government 17% Rs.55,218 cr. of Pvt. loan Loan Assets 83% Assets 92% of Loan Assets are regular in servicing & no stress is envisaged
Slide 21: Provisioning Snapshot
21 Provisioning Snapshot Provisioning Status as on 31.12.2019 (Rs.’crore) Stage III (NPA) as % Stage I & II Stage III Total of Gross Loan Assets Outstanding Loan Assets - Government Sector 2,77,744 - Nil 2,77,744 - Private Sector 27,453 27,765 8.34% 55,218 Total Outstanding Amount 3,05,197 27,765 8.
Slide 22: Resolution Status – Stage III Assets (1/2)
22 Resolution Status – Stage III Assets (1/2) Resolution status of Rs.27,765 cr. of loan assets in Stage 3 NCLT Resolution Outside NCLT Resolution Rs.14,704 cr. in Rs.13,061 cr. resolution being NCLT pursued outside NCLT 15 projects 14 projects 64% provision 41% provision 71% provision/reserve* avai
Slide 23: Resolution Status – Stage III Assets (2/2)
23 Resolution Status – Stage III Assets (2/2) 6 projects of Rs. 9,078 cr. with 47% provisioning nearer to resolution RKM Powergen 1 Outside NCLT Resolution Rs.5,163 cr. Ind Barath Utkal 2 Rs.1,368 cr. NCLT Resolution India Power Haldia 3 Rs.959 cr. Jhabua Power 4 Rs.764 cr. Essar Transmission 5 Rs.4
Slide 24: Operational Performance
24 4 Operational Performance
Slide 25: Loan Asset – Composition
25 Loan Asset – Composition – Others 1% T&D 29% Increasing thrust towards T&D & As on Generation 31.12.2019 renewable business (Conventional) 59% Renewable (including Large Hydro) 11% (Rs.’crore) As on 31.12.2019 As on 31.12.2018 Gross Loan Assets 3,32,962 2,98,580 Scheme Wise Generation 2,33,245 2,
Slide 26: Disbursements - Composition
26 Disbursements - Composition (Rs.’crore) Q3 FY 20 Q3 FY 19 9M FY 20 9M FY 19 Amt. % Amt. % Amt. % Amt. % Disbursements 18,413 100% 14,648 100% 47,246 100% 45,134 100% Scheme Wise Generation 11,936 65% 7,909 54% 27,132 57% 18,556 41% Transmission 1,610 9% 1,588 11% 4,185 9% 4,389 10% Distribution 4
Slide 27: Borrowing Highlights
27 Borrowing Highlights Rs. 63,790 cr. raised in 9M’20 75% domestic raising & 25% USD 250 mn raised foreign raising Raised in Q’3 for a 5 year tenure 3 time Jump in 54 EC Bond raising from 9M’19 22bps reductions in cost Cost of funds at 7.82% against 8.04% in 9M’19
Slide 28: Well Managed Liability Profile
28 Well Managed Liability Profile Rs. 2,89,264 of outstanding borrowings as on 31.12.2019 17% Diversification of funding profile 14% 86% from domestic sources & 14% from foreign currency sources 1% 3% 0.58% 7.82% borrowing cost CP at just 1% of total liability mix as against 5% in Q1’20 64% 67% exch
Slide 29: Liability Mix as on 31.12.2019
29 Liability Mix as on 31.12.2019 Domestic Bonds Rs.1,84,712 cr. RTL from Banks/FI’s Rs. 49,101 cr. Diversified Foreign Currency Borrowing Liability Rs.2,89,264 cr. Rs.41,591 cr. Outstanding Mix Borrowings as Commercial Papers Rs.2,961 cr. on 31.12.2019 Subordinated Bonds Rs.9,212 cr. 54EC Bonds Rs.
Slide 30: PFC's access to low cost funds
30 PFC’s access to low cost funds 54EC Salient Features Individuals,HUF,NRI,FIs,LLP,Partnership,Banks, Eligible Investors Mutual Funds, Insurance Co., PF funds Tenor 5 years from deemed allotment date 54EC Resource Coupon Rate 5.75% per annum. Mobilization jumps by more than 3 times from 9M’19 Benef
Slide 31: Shareholder Outlook
31 5 Shareholder Outlook
Slide 32: Shareholders Outlook
32 Shareholders Outlook Equity market valuation ratios indicate potential for upside GOI EPS Rs. 21.31 (Annualised) 56% FIIs & FPIs Book Value Per Share Rs. 179 19% Mutual Funds 13.7% Price to Earning Ratio 5.5 56% GOI Shareholding Indian FIs & Banks 6.6% 0.05% Employees Price to Book Value Ratio 0.
Slide 33: Thanks!
33 Thanks! You can reach PFC’s Investor Relations Team at investorrelations@pfcindia.com Any questions? Join us: @pfclindia www.pfcindia.com
Slide 34: Disclaimer
34 Disclaimer ▷ The presentation is prepared based on stand-alone unaudited financial statements of PFC for quarter ended 31.12.2019 ▷ There is a possibility of Ind AS financial results and the additional disclosures to be updated, modified or amended because of adjustments which may be required to