Power Finance Corp board did not discuss Shapoorji Pallonji Group loan

Board had sanctioned a loan of Rs 20,000 crore to the SP Group in June

The Power Finance Corporation (PFC) did not take up the issue of a loan sanctioned to the Shapoorji Pallonji (SP) Group in its board meeting held in Delhi today, said a top PFC official. The corporation’s board had earlier sanctioned a loan of Rs 20,000 crore to the SP Group on June 14, 2024, as per media reports.

Earlier, the SP Group stated it would be repaying the loan via its real estate franchise’s cash flow. The firm has also pledged a portion of the Tata Sons shares owned by the Mistry family as part of a twin security structure for its loan repayment, the statement said. The Mistry family owns an 18.4 per cent stake in Tata Sons. The SP Group statement was in response to media reports that some independent directors of PFC had objected to the loan.

 

In its statement, SP Group stated that the value of the provided security structure is in excess of six times the loan value and that it will ensure the complete repayment of the loan over the tenor. The group worked with PFC for the last nine months to formalise this “unique proposal,” which was validated by reputed third-party consultants.

Besides, as of March 2024, PFC has sanctioned about Rs 82,000 crore to the infrastructure sector. The corporation has played a vital role in financing the industry.

PFC’s consolidated net profit up 20% on a yearly basis

The corporation also announced its quarterly financial results in today’s board meeting. It reported a net profit of Rs 7,182.06 crore, 20 per cent more than what it was during the same period of the last financial year. The total income stood at Rs 24,736.68 crore, compared to Rs 21,017.81 crore in Q1 FY24.

The state-owned firm also declared an interim dividend of Rs 3.25 per equity share (subject to deduction of TDS) on the face value of the paid-up equity shares of Rs 10 each for FY 2024-25.