Power Finance Corporation Limited NCD (Power Finance Corporation NCD July 2023) Detail

July 21, 2023 - July 26, 2023

Incorporate in 1986, Power Finance Corporation Limited (PFC) is one of the leading financial institutions in India. It is focused on the power sector. PFC works with Government of India (GoI) agencies, state governments, power sector utilities, other power sector intermediaries, and private sector clients for the development and implementation of policies and structural and procedural reforms in the power sector in India.

PFC is registered with the RBI as a non-deposit taking systemically important NBFC. PFC was granted the 'Navratna' status by the GoI in 2007.

PFC provides a range of financial products and other services including:

Services ranging from project conceptualization to the post-commissioning stage, including generation (conventional and renewable), transmission and distribution projects, and related renovation and modernization projects;
Various forms of fund-based assistance, including long-term project finance, short-term loans, buyers' lines of credit, underwriting of debt, and debt refinancing schemes;
Various forms of non-fund-based assistance including default payment guarantees, credit enhancement guarantees, and letters of comfort; and
Various fee-based technical advisory and consultancy services for power sector projects through our wholly-owned subsidiary PFC Consulting Limited.

Power Finance Corporation NCD July 2023 Detail

Issue Open	July 21, 2023 - July 26, 2023
Security Name	Power Finance Corporation Limited
Security Type	Secured, Redeemable, Non-Convertible Debentures (Secured NCDs)
Issue Size (Base)	Rs 500.00 Crores
Issue Size (Shelf)	Rs 5,000.00 Crores
Issue Price	Rs 1000 per NCD
Face Value	Rs 1000 each NCD
Minimum Lot size	10 NCD
Market Lot	1 NCD
Listing At	BSE
Credit Rating	CARE AAA, Stable by CARE Ratings Limited, CRISIL AAA/Stable by CRISIL Limited and ICRA AAA, Stable by ICRA Limited
Tenor	3, 10, and 15 years
Series	Series I to III
Payment Frequency	Annually
Basis of Allotment	First Come First Serve Basis
Debenture Trustee/s	Beacon Trusteeship Limited

NCD Allocation Ratio

Category	NCD's Allocated
Institutional	10%
Non-Institutional	10%
HNI	40%
Retail	40%

NCD's Offered by Category

Category	NCD's Reserved
Institutional	500,000
Non-Institutional	500,000
HNI	2,000,000
Retail	2,000,000
Total NCD's	5,000,000

Power Finance Corporation Limited NCD Coupon Rates

#	Series 1	Series 2	Series 3
Frequency of Interest Payment	Annual	Annual	Annual
Nature	Secured	Secured	Secured
Tenor	3 Years	10 Years	15 Years
Coupon (% per Annum)	7.50%	7.53%	7.55%
Effective Yield (% per Annum)	7.49%	7.52%	7.54%
Amount on Maturity (In Rs.)	Rs 1,000.00	Rs 1,000.00	Rs 1,000.00

NCD Rating

The NCDs proposed to be issued under the issue have been rated "CARE AAA, Stable" by CARE Ratings Limited, "CRISIL AAA/Stable" by CRISIL Limited, and "ICRA AAA, Stable" by ICRA Limited.

Company Promoters

The promoter of the company is the President of India acting through the Ministry of Power, Government of India.

Company Financials

Power Finance Corporation Limited Financial Information (Restated Consolidated)
Period Ended	Total Assets	Total Revenue	Profit After Tax	Net Worth	Reserves and Surplus
31-Mar-21	775,707.08	71,700.67	15,716.20	81,790.25	60,371.31
31-Mar-22	791,000.27	76,344.92	18,768.21	96,275.15	69,310.98
31-Mar-23	896,111.86	77,625.19	21,178.59	111,981.28	82,507.74
Amount in ₹ Crore

Objects of the Issue

The company intends to utilize the net proceeds from the issue towards the funding of the following objects:

For the purpose of onward lending, financing / refinancing the existing indebtedness of the company, and/or debt servicing (payment of interest and/or repayment/prepayment of interest and principal of existing borrowings of the company), and
General corporate purposes.

Power Finance Corporation NCD July 2023 Prospectus

Power Finance Corporation NCD July 2023 Subscription Status

The Power Finance Corporation NCD July 2023 was subscribed 5.84 times on July 26, 2023 1:00:00 PM. The NCD subscribed 2.23 times in Retail, 9.24 times in HNI, 7.55 times in Non-Institutional, and 5.01 times in the Institutional category.

Category ?	Subscription (times)
Retail	2.23x
HNI	9.24x
Non-Institutional	7.55x
Institutional	5.01x
Total	5.84x

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Power Finance Corporation NCD July 2023 Rating

4.5

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Company Contact Information

Power Finance Corporation Limited
“Urjanidhi”, 1,
Barakhamba Lane,
Connaught Place, New Delhi – 110 001

Phone: +91 11 2345 6000
Email: publicissue2324@pfcindia.com
Website: https://www.pfcindia.com/

Power Finance Corporation NCD July 2023 Registrar

Kfin Technologies Limited
   KFintech, Tower-B, Plot No 31 & 32,
   Financial District, Nanakramguda, Gachibowli,
   Hyderabad, Telangana India - 500 032.

Phone: 04067162222, 04079611000
Email: pfcl.ncdipo@kfintech.com
Website: https://kosmic.kfintech.com/ipostatus/

Power Finance Corporation NCD July 2023 Lead Manager(s)

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20 Comments

20. SRIPRASH Link|August 1, 2023 10:04:46 PM

Money debited,allotment email recieved ...applied for 990 ncd ,got 990 ncd...applied in retail befor 10.30 am first day...till then it wasn't fully subscribed.....allocation is first come,first serve...not proportional

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20.6. SKAGG Link|August 24, 2023 10:28:05 PM

What price it got listed and

What is the current price

20.7. SRIPRASH Link|August 25, 2023 7:49:39 AM

It listed on 999...went upto 997 ....yesterday was at 1005

19. Ashok Link|August 7, 2023 1:49:26 PM

already listed on last friday

19.1. Seth. Link|August 10, 2023 6:45:30 PM

Ohk
Any idea what is ISIN and how much listing gain it gave?

18. Seth. Link|August 5, 2023 12:20:33 AM

What is Listing date and code

18.1. Seth. Link|August 7, 2023 12:06:48 PM

Anyone have idea of this?

17. Ashok Link|August 6, 2023 2:49:28 PM

how good is the investment in PFC NCD? Is it worth it , can we expect 3 % CAGR in addition to 7.5 % interest paid?

16. SKAGG Link|August 1, 2023 5:41:50 PM

What price it got listed

15. Pinak Soni Link|August 1, 2023 11:58:32 AM

Money debited...

14. Seth Link|July 27, 2023 9:32:07 PM

Is last day tommorrow to apply?
And can we sell listing without liquidity issue as rating is good?

13. suresh Link|July 26, 2023 10:19:58 AM

is the interest from PFC NCD taxable?

13.1. SKAGG Link|July 26, 2023 11:05:58 AM

Yes

12. Tanuj Goyal

1| Link|July 20, 2023 10:33:09 PM

Have done some research - let me know what you think?

A quick back of the hand calculation of PFC NCD opening tmrw

Specs - 7.5% coupon payable annually - 3 tranches maturing 3/10/15 years

No comparable psu AAA rated bond having tradable liquidity presently (most ntpc / irfc / PFC bonds are either tax free bonds or of a widely different coupon rate or maturity)

A comparison with very liquid gsec 2033 maturity 7.26 % coupon rate having market price of 104.10 results in a yield to maturity (YTM) of 6.70%

In previous AAA rated PSU bonds issued since 2019 onwards, I have observed that their YTM was either equal to or slightly less than Gsec!! (This was something new because I had this feeling that the YTM would be higher due to risk premium), but it was comparable due to high demand for good quality paper.

Even if we assign a risk premium of 30 bps and evaluate at a YTM of 7.0% , the price of 1000 and coupon of 7.50% gives a price of 103.5 for 10 year ncd and appx 104.85 for 15 year paper.

In my opinion, at a conservative estimate it can deliver listing gains of 2.5 - 3.0%

Although Two risk factors are there - liquidity of the paper on listing day and any adverse interest rate movement from the opening of issue till listing date, the second factor has a bleak chance of happening but still!

The good thing is that un like hot IPOs, one has a confirmed chance of allocation if application is made on first or second day (it's a first come first serve NCD)

So assuming that you put ₹1 crore in the NCD and the money is blocked for 10 days, OD against FDr of 8% interest cost , the cost of capital is ₹22500 , and at a 2% listing gain, the expected return would be ₹200000-22500-2500(misc / brokerage etc ) would be ₹175,000

I have decided to give it a shot, I see a limited downside potential, but liquidity scenario and may be selling by individuals on listing day for short term gains may spoil the party

Investing presents new opportunities everyday, and experimenting with a limited risk can open new frontiers so let's see what PFC NCD has in store for us!

(This write up is personal opinion and is by no means a recommendation to invest in this instrument)

Tanuj Goyal

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12.1. NealCaffery Link|July 21, 2023 1:28:37 PM

@Tanuj Goyal Great analysis. I have not seen any NCD selling at this much premium after listing (1025 - 1030 in this case). Also the Base+Greenshoe size is very big : 500+4500 Crores, so I feel there will be very less or No buyers as everybody who applies it will get the allotment. Anyway lets be hopeful for 2.5-3% Listing gains.

BTW, how to apply for this NCD in HNI online as I don't see this in ASBA of many banks? Only see retail option using UPI on certain portals like Goldenpi or paper based application form for HNIs but no Online option.

12.2. Nothing New Link|July 21, 2023 1:48:59 PM

Check out PFC N1 (CMP 1260), PFC N2 (CMP 1113), PFC N3 (CMP 1240). Depending on the tenure and the coupon rate all are trading at a premium to adjust the yield to close to 6.8 %

I would apply for a 3 year NCD as there is not much difference between 10, 15 and 3 year coupn rate and 7.55 % yield for a 3 year government NCD shan't sustain for long.

12.3. Seth Link|July 21, 2023 7:11:52 PM

Hi @Tanuj
Can we sell on listing via groww or zerodha demat?
And it's already subscribed so now allotment would be proportionate or not?
Is there any chance if I apply now?

12.4. ipo stonks Link|July 22, 2023 6:22:58 PM

@Tanuja Goyal
Buddy your assumptions are too optimistic
1. When you apply for 1cr worth of bonds you won’t get it all.
2. Listing of 2.5%-3% is tooooo optimistic.

Let’s say you apply for 1cr bonds you get some 40L worth of bonds alloted (4000 bonds). Listing gain will be Rs 2-3.
Meaning a gain of 12000Rs.
And cost of 1cr @9% for 8 days will be ~Rs. 20,000. Brokerage paid will be some 8000Rs.
It is a loss.

BUT
What you can do is have a broker who shares his commission with you when you apply through him.
Generally they pay 0.5-0.75% as commission.
On 40L worth of alloted shares you would’ve got Rs. 30,000.

In short net you’ll get Rs. 15,000 from this whole deal.

12.5. Tanuj Goyal Link|July 22, 2023 6:34:02 PM

@ipo stonks - 2% is 1020 not 1002, although the whole exercise of pricing and valuating it has failed because there was a major discrepancy in the Market price of Gsec 7.26% 2033 maturity. My broker gave me a rate of 104.2 which translates into 6.70% YTM whereas in institutional market which is more liquid and an apt represtation, the rate is 101.20 , YTM 7.08% so the whole thesis of investing becomes pointless from. Listing gains perspective!

Reg your second point of allotment since it's a first come First serve basis of allotment, how come you are assuming 40% allotment when you are applying on the first day itself? Just want to know if there is a basis of allotment which I am Missing.

Thanks for a healthy discussion point

12.6. ipo stonks Link|July 24, 2023 3:29:34 PM

@Tanuj Goyal
I know 2% is 1020, but I am saying it’ll give listing gains of only 2-3Rs i.e. 0.2%-0.3%.

You have good knowledge about the yields their comparison to Gsec.

Okay, so when the issue is oversubscribed on the first day itself, then all applicants will get proportionate allotment (because they all applied on the first day).
First come first serve is not application wise but day wise.

I have earlier applied in National Highways Infrastructure Trust in October 2022, at that time I understood the “first come first serve” allotment concept in NCD’s.

Absolutely good to have people discussing on the NCD issues.

12.7. Vikrant Agarwal Link|July 25, 2023 5:39:10 PM

@NealCaffery Kotak bank gives you the option when applying from the website, not from the app. This could be the case with other banks too.

11. SKAGG Link|July 18, 2023 12:33:33 PM

Do brokers give any cash incentives upfront for applying in ncd issues ? Earlier I think around 1% was available

11.1. rajaipo Link|July 18, 2023 3:41:02 PM

0.20% available

11.2. Seth Link|July 25, 2023 4:47:16 PM

@raj I want to apply which broker willgive brother?

10. BBMuffin Link|July 25, 2023 1:14:15 PM

They have shelf size of 5000 crores which is 10 times of issue size, so we can apply till 10x times to get allotments. So, the issue is still open and you can apply. I just found a way to apply as guest user (without creating account) thru edelweiss (nuvama wealth) site. You can also apply thru India bonds etc., I chose nuvama as it is edelweiss (recognized) and allows me as guest to apply.
Under 5 lakhs, you can pay using upi mandate. Hope this helps all new bond buyers.

10.1. Seth Link|July 25, 2023 4:44:30 PM

Ok
If we allotted 5 lac then can we sell on listing day ?
Someone mentioned that on listing there is not enough liquidity we get.

9. Rakesh Agarwal Link|July 25, 2023 10:17:04 AM

Whether this issue is still open?

8. BBMuffin Link|July 20, 2023 6:31:07 PM

How can we apply for this ncd online? It starts tomorrow.. Thanks!

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8.2. BBMuffin Link|July 24, 2023 10:37:35 AM

It is already over subscribed for retail category in first day... so I do not think we have any choice here...
Should we consider Indiabonds.com or some web sites like that to buy bonds? How reliable they are? Any light on this matter will help in future bonds for beginners.

8.3. ipo stonks Link|July 24, 2023 3:21:10 PM

Guys!!
The bonds will close today, if you want to apply, you can apply it today. You can apply through wint wealth and the best option is to apply through your broker.

7. Seth Link|July 21, 2023 7:08:26 PM

Isme oversubscribed hone ke baad allotment proportioned basis pe hoga ya lottery?

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7.3. ipo stonks Link|July 22, 2023 6:07:12 PM

@Seth
If the issue gets fully subscribed on Day 1 itself then it will be proportionate allotment.

@Ankur Goel
First come first serve will happen when the issue is open for multiple days.

7.4. Seth Link|July 22, 2023 6:23:10 PM

@ipo stonks Ok thanks

6. Ramesh Kumar Kejriwal Link|July 21, 2023 10:14:32 AM

Not for Senior citizens, Because SCSS given 8.20% quarterly basis with highest safety. So ignore by Senior citizen.

5. SKAGG Link|July 18, 2023 12:32:34 PM

Can we expect some listing gain maybe 2-3% ?

5.1. ipo stonks Link|July 20, 2023 12:51:43 PM

You can expect 2Rs-3Rs per NCD i.e. 0.2%-0.3%

4. SKAGG Link|July 19, 2023 8:42:27 PM

What is the upper limit of retail application here.

4.1. ipo stonks Link|July 20, 2023 12:50:06 PM

Upper limit is 10L for retail

3. Saurabh Ji Link|July 19, 2023 2:16:45 PM

Bhai UTKARSH BANK 1500 days ki FD pe 8.25 interest de raha hai. Kaun is NCD mein apply karega?

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3.5. Ankur Goel Link|July 19, 2023 9:14:33 PM

@fish, you can sell it any day. Listing gain Will be very thin as it is debt instrument. You will see hardly 10-20 gain per ncd on listing day.

3.6. Ipo Stonks Link|July 20, 2023 12:48:41 PM

@fish Debt instrument don’t give a listing pop. They generally trade +-2/3 Rs. That’s it. Expecting 10-20 Rs is very very tough.
Also you can sell on listing day and afterwards any time you want, but there is liquidity issues also, if you have large quantity getting out is a tedious task.

@Ankur Goel
If bonds yield increase the price of the bonds has to fall right ? So, that implies the price of this bond might fall ?

2. SKAGG Link|July 19, 2023 8:43:51 PM

Will there be any BHNI quota here. If yes the range of application amount

1. SKAGG Link|July 19, 2023 8:43:08 PM

Is there any discount or benefit to retail investor like higher interest etc