Power Finance Corporation of India Ltd. has acquired 52.63% of the government's stake in REC Ltd, according to an exchange filing on Friday.
The acquisition makes REC a subsidiary of PFC and comes after an in-principle approval from the Cabinet Committee on Economic Affairs.
PFC, in the regulatory filing, said its board has "accorded its in-principle approval for restructuring in the form of a merger of PFC and REC, while ensuring that, the merged entity continues to remain as a 'government company'."
As per the shareholding pattern available with the exchanges for the period ending December 2025, the government held 52.6% stake in REC, whereas public shareholders owned 47.4% shares. The latter includes mutual funds, foreign portfolio investors, insurance companies and alternative investment funds.
Finance Minister Nirmala Sitharaman, in her Budget speech, had announced that under the new vision for non-banking financial companies, a restructuring of PFC and the REC was required.
"The vision for NBFCs for Viksit Bharat has been outlined with clear targets for credit disbursement and technology adoption. In order to achieve scale and improve efficiency in the Public Sector NBFCs, as a first step, it is proposed to restructure the Power Finance Corporation and Rural Electrification Corporation," she said.
Q3 Recap
REC's net profit in the December was almost flat at Rs 4,052 crore, as compared to Rs 4,076 crore in the year-ago period. The company logged a 5.4% increase in its total income to Rs 15,058 crore from Rs 14,287 crore in the corresponding quarter of the last fiscal. Further, it also declared its third interim dividend of Rs 4.6 per share
Power Finance Corp. logged a consolidated net profit of Rs 6,292 crore year-on-year in the quarter ended December 2025, marking an 8% uptick as compared to Rs 5,829 crore in the year-ago period. The public sector enterprise's total income saw an uptick of 8.6% to Rs 29,141 crore. The company also declared its third interim dividend at Rs 4.
Share Price
PFC's stock ended 0.63% higher at Rs 417.60 apiece on the NSE, ahead of the acquisition announcement on Friday. On the contrary, REC closed in red, 1.30% lower at Rs 372.60. These compare to the 0.20% advance in the Nifty index.
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