Both REC & PFC are from same sector under same owner & same dynamic power minister Piyush Goyal. REC has run up sharply vs PFC . Both are still cheap & I am invested in both though REC since July 16 & PFC recently due to valuation mismatch .
I had applied in recently closed CPSE ETF & after availing retail discount n expected rise in NAVs in various family members name will sell in April. I had bought in advance on CPSE listing day equivalent amount of PFC one of the better & cheaper constituent amongst 10 stocks of CPSE keeping juicy dividend of 5 Rs with record date of 1 April in mind.The same strategy i adopted with earlier CPSE when i converted that in to REC
REC loan book is more diversified viz PFC which is more into generation.REC also has access to low cost Tax gain exemption bonds which improves its margin.
More importantly imho Rajiv Sharma who was MD for 5 years at REC & a power sector specialist having started his career in CEA then moved to PFC REC & is now again MD PFC. Rajiv Sharma has a great reputation and work ethics & popularity amongst employees vs Ex MDs of PFC. Good part is now that he has been appointed MD of PFC till 2020. So PFC future looks bright .
There is great change for better happening in Indian power sector under Piyush Goyal with debt burden moving to respective state govt balance sheet from DISCOMs under Uday scheme .Now the govt is concerned of the huge debt burden & will take necessary reform measure by cutting down T&D losses,go in for smart metering & other measure under IPDS under PFC ,DDUJ involving separation of agricultural & domestic feeders in rural india under supervision of REC,more collection of power bills happening through franchise route like in rajasthan recently in addition to other states.
Pvt sector plants getting abundant coal availability thanks to a resurgent Coal India & special E Auction,availability of subsidized imported Gas and commissioning one by one and able to service loans.Indias power consumption shud also slowly increase