Power Finance Corporation (PFC), a leading non-banking financial company in the power sector, reported a modest 2% year-on-year increase in standalone net profit for the second quarter of fiscal year 2026. The company's performance showed mixed results across various financial metrics.

Financial Highlights

PFC's standalone net profit increased to ₹4,462.00 crore in Q2 FY26, up from ₹4,370.00 crore in the same quarter last year. However, on a sequential basis, the profit declined by 0.90% from ₹4,501.00 crore in the previous quarter.

The company's net interest income showed strong growth, rising 20.00% year-on-year to ₹5,290.00 crore. This growth in interest income contributed significantly to the overall revenue increase.

Total revenue from operations for Q2 FY26 stood at ₹14,755.00 crore, marking a 12.00% increase compared to the same period last year.

Consolidated Performance

On a consolidated basis, PFC reported a more substantial growth in net profit, which increased by 9.00% year-on-year to ₹7,834.00 crore. However, it's worth noting that the consolidated profit fell by 13.00% compared to the previous quarter.

Dividend Announcement

The Board of Directors has declared a second interim dividend of ₹3.65 per share for the fiscal year 2026. The record date for this dividend has been set as November 26, 2025.

Market Performance

Despite the financial results, PFC's shares have faced downward pressure in the market:

• Shares declined 2.85% over two trading sessions following the Q2 FY26 results announcement, closing at ₹369.60.
• Over the past year, PFC shares have declined by 22.90%.
• Year-to-date, the stock has seen a decrease of 17.19%.

Outlook

While PFC has shown resilience in its core operations with growth in net interest income and overall revenue, the marginal increase in standalone profit and the decline in consolidated profit on a quarter-on-quarter basis may raise some concerns among investors. The company's ability to maintain profitability in the face of potential challenges in the power sector will be crucial for its future performance.

Investors will likely keep a close eye on PFC's loan book quality, fundraising activities, and the overall health of the power sector as key indicators for the company's future growth prospects.

Power Finance Corporation Limited (PFC) has announced a significant development in its corporate structure. Alibag Power Transmission Limited has been incorporated as a wholly-owned subsidiary of PFC Consulting Limited (PFCCL), which is itself a wholly-owned subsidiary of PFC.

Purpose and Background

The incorporation of Alibag Power Transmission Limited serves a specific purpose in the power sector:

This move is part of a larger initiative in the power transmission sector. Maharashtra State Electricity Transmission Company Limited (MSETCL) has appointed PFCCL as the Bid Process Coordinator (BPC) for selecting a developer through a tariff-based competitive bidding process for Independent Transmission Projects (ITPs).

Role of the New Subsidiary

Alibag Power Transmission Limited, as a Special Purpose Vehicle (SPV), will undertake crucial preparatory activities for the transmission project:

1. Conducting surveys and preparing reports
2. Initiating the process of land acquisition
3. Seeking forest clearance, if required

These steps are in line with the tariff-based competitive bidding guidelines issued by the Ministry of Power.

Future Plans

The newly formed SPV is not intended to be a permanent subsidiary of PFCCL. The company has outlined the following process:

1. PFCCL will develop the transmission scheme after necessary approvals.
2. The SPV will be transferred to the successful bidder upon completion of the bidding process.
3. The selected bidder will then be responsible for developing the project further.

This strategic move by PFC and its subsidiary PFCCL demonstrates their commitment to facilitating the development of power transmission infrastructure in Maharashtra. By creating this SPV, they are laying the groundwork for efficient project implementation and competitive bidding in the power sector.

The incorporation of Alibag Power Transmission Limited as a subsidiary marks an important step in PFC's role in supporting India's power infrastructure development, particularly in enhancing the transmission capabilities in the Maharashtra region.