State-owned Maharatna PSU Power Finance Corporation Ltd has secured board approval for a significant fundraising initiative through non-convertible debentures. The approval, granted on January 12, enables the company to proceed with its capital mobilization strategy.

Board Approval Details

The board has approved a public issue of secured, rated, listed and redeemable non-convertible debentures (NCDs) with a fundraising target of up to ₹5,000 crores. This NCD issuance represents a substantial capital raising exercise for the Maharatna PSU.

Shelf Fundraising Program

The approved NCD issue forms part of Power Finance Corporation's broader shelf fundraising program worth ₹10,000 crores. This strategic approach allows the company to access capital markets efficiently as per its funding requirements and market conditions.

The shelf fundraising mechanism provides Power Finance Corporation with flexibility in timing and structuring its capital market access, enabling the PSU to optimize its funding costs and meet operational requirements effectively.

Power Finance Corporation Limited has announced a significant public issue of secured, rated, listed, redeemable non-convertible debentures (NCDs) worth up to ₹5,000 crores. The Chairman & Managing Director, on recommendation of the Director (Finance), has approved this comprehensive debt issuance under the company's shelf limit of ₹10,000 crores.

Issue Structure and Size

The NCD issue features a strategic two-tier structure designed to provide flexibility in fundraising. The base issue size stands at ₹500 crores, with an option to retain oversubscription up to ₹4,500 crores, bringing the total Tranche I Issue Limit to ₹5,000 crores.

Investment Options Across Five Series

The issue offers five distinct NCD series, each tailored to different investor preferences and risk appetites. The series vary in tenor, coupon structure, and effective yields, providing comprehensive options for diverse investment strategies.

Investor Categories and Pricing

The NCDs are structured with differentiated pricing across four investor categories, offering enhanced returns for specific investor segments. Category IV investors receive the highest effective yields across all series, while Categories I and II receive base rates.

For Series III zero coupon NCDs, the issue prices vary significantly by category:

• Categories I and II: ₹51,502.00 per NCD
• Category III: ₹51,263.00 per NCD
• Category IV: ₹50,780.00 per NCD

Security and Issue Timeline

The NCDs are secured by a first pari-passu charge through hypothecation of book debts and receivables, maintaining a security cover of at least 100% of outstanding principal and interest until maturity. This security structure provides enhanced protection for investors.

Regulatory Compliance and Documentation

The issue operates under comprehensive regulatory framework compliance, with the Shelf Prospectus and Tranche I Prospectus dated January 09, 2026, filed with the Registrar of Companies, Delhi and Haryana. The documentation has been submitted to SEBI and the National Stock Exchange of India Limited, ensuring full regulatory adherence.

In case of payment default, the company has committed to paying additional interest of at least 2% per annum over the coupon rate for the defaulting period, providing additional investor protection. The issue remains open on working days from 10:00 a.m. to 5:00 p.m. during the subscription period, with provisions for early closure or extension subject to regulatory requirements.