Macquarie expects Power Finance Corp (PFC) to book a large mark-to-market loss in second quarter of FY12 due to unhedged foreign currency liabilities and sharp fall of the rupee.
PFC has 50 billion rupees of foreign currency liabilities, out of which 86 percent is unhedged, Macquarie said in a note.
We think the hit in 2Q12 due to adverse movement in the Yen and USD compared to the Indian rupee (INR) could be as much as 5 billion rupees or 50 percent of estimated pre-tax-profits for the quarter, Macquarie said in a note maintaining a outperform rating with a stock target price of 190 rupees.
At 11.32 a.m shares were at 139.35 rupees, down 2.07 percent.
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