Power Finance Corporation Ltd is among the higher-yielding stocks in the power financing space, with a 5.22% dividend yield.
However, what makes the company genuinely stand out as a dividend stock is not just its regular dividend payment or high dividend yield, but the frequency of dividend payments too.
While the dividend paid by PFC grew from Rs 5 per share in FY2017 to Rs 18.55 per share in FY2026, the frequency of dividend payments also jumped fivefold. In FY25 as well as in FY26, the company paid dividends five times through the fiscal year.
Dividend Payout Has Grown Over The Years
Financial year | Dividend/share (Rs) | Payouts |
FY2017 | 5.00 | 1 |
FY2018 | 7.80 | 2 |
FY2019 | 0 | 0 |
FY2020 | 9.50 | 1 |
FY2021 | 10.00 | 2 |
FY2022 | 12 | 4 |
FY2023 | 13.25 | 4 |
FY2024 | 13.50 | 4 |
FY2025 | 15.80 | 5 |
FY2026 | 18.55 | 5 |
For FY2027, the dividend payment cycle has already begun with the first interim dividend of Rs 3.90 per share. This is higher than the Rs 3.70 per share interim dividend in the year-ago period.
Profit Growth Gives Dividend Headroom
PFC's rising dividend has come alongside strong profit growth.
Standalone Profit after tax increased 16% to Rs 20,051 crore in FY2026, from Rs 17,352 crore in FY2025. PFC's net worth increased 13% to Rs 1,02,532 crore.
On a consolidated basis, profit after tax rose 10% to Rs 33,625 crore, while loan assets increased 5% to Rs 11.64 lakh crore.
Asset quality also improved sharply. Consolidated gross NPA fell to 0.66% from 1.64%, while net NPA declined to 0.13% from 0.38%.
Historical Financial Performance
Particulars | FY2022 | FY2023 | FY2024 | FY2025 | FY2026 |
Total Income | Rs 38,591 crore | Rs 39,666 crore | Rs 46,034 crore | Rs 53,128 crore | Rs 58,542 crore |
Total Expenses | Rs 26,364 crore | Rs 25,495 crore | Rs 28,408 crore | Rs 31,955 crore | Rs 33,767 crore |
Profit Before Tax | Rs 12,228 crore | Rs 14,171 crore | Rs 17,626 crore | Rs 21,172 crore | Rs 24,774 crore |
Tax Expense | Rs 2,206 crore | Rs 2,565 crore | Rs 3,259 crore | Rs 3,820 crore | Rs 4,723 crore |
Profit After Tax | Rs 10,022 crore | Rs 11,605 crore | Rs 14,367 crore | Rs 17,352 crore | Rs 20,051 crore |
The profit has doubled from Rs 10,022 crore to Rs 20,051 crore in just five years, along with the significant jump in the total income, which justifies the company's increasing dividend payouts.
Renewable Lending Adds To The Growth Story
Renewable energy is becoming a bigger part of PFC's lending book.
PFC's renewable loan book reached Rs 90,135 crore in FY2026, compared with Rs 37,474 crore in FY2021. Renewable energy accounted for 32% of the outstanding generation loan book in FY2026, against 17% five years earlier. PFC had supported around 66 GW of renewable capacity by FY2026.
Thus, for investors, the key factor to monitor going forward will be whether PFC can maintain earnings growth while keeping the loan book and asset quality under control.
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