Power Finance Corporation (PFC) on Wednesday reported its highest-ever annual net profit of ₹20,051 crore for FY26, crossing the ₹20,000-crore mark for the first time, even as lower interest rates, borrower prepayments and rupee depreciation weighed on quarterly earnings.
The state-run non-bank lender posted a 3 per cent increase in consolidated net profit for the January-March quarter at ₹8,598 crore.
Core net interest income declined 11 per cent to ₹10,833 crore during the reporting quarter as net interest margin narrowed to 3.55 per cent in FY26 amid lower interest rates and higher prepayments by borrowers.
The company said loan book growth during FY26 stood at 7 per cent, but would have been close to 11 per cent had borrowers not prepaid loans during the lower interest rate cycle.
PFC’s net worth crossed ₹1 lakh crore for the first time and stood at ₹1,02,532 crore at the end of FY26, registering a 13 per cent year-on-year growth.
Asset Quality at Record Highs
The company also reported improvement in asset quality, with net credit impaired asset ratio declining to around 0.15 per cent, its lowest level so far, following resolution of stressed projects including Sinnar Thermal and TRN Energy.
PFC’s board recommended a final dividend of ₹3.95 per share, taking the total dividend payout for FY26 to ₹18.55 per share.
PFC-REC Mega-Merger
Commenting on the performance, Chairman and Managing Director Parminder Chopra said FY26 had been a year of “strong performance, important milestones and a challenging global environment”.
“A key development for us has been the proposed merger of PFC and REC, which marks a significant step towards creating a single, focused institution for the power sector. This will pave the way for greater scale, improved efficiencies and unlocking of capital synergies,” Chopra said.
The company said it remained focused on financing requirements linked to energy transition and emerging technologies, backed by a standalone capital base of over ₹1 lakh crore.