InvestorQ : Is it true that the Power Finance Corporation (PFC) is also staring at a huge NPA burden in the coming months?
Archita Jajjoo made post

Is it true that the Power Finance Corporation (PFC) is also staring at a huge NPA burden in the coming months?

Answer
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Rashi Mehra answered.
5 months ago


What you are saying applies to the largest power financers in India viz. PFC and Rural Electrification (REC). According to a report by IEEFA, Power Finance Corporation (PFC) could be sitting on potential NPAs of $6.8 billion. PFC has disbursed loans worth Rs.344,000 crore to the thermal power sector. Of these loans, nearly 15% are NPAs representing a quantum of over Rs.47,000 crore. The report has pointed out that both PFC and REC may have been funding unviable thermal power plants resulting in a ticking time bomb of NPAs. Most of these NPAs are yet to be recognized. Most off the thermal power loans have virtually become stranded loans. These could hit the government balance sheet as most thermal plants are unviable as of now.