PTC shares rise as its unit gets 'infrastructure finance company' status

PTC shares rise as its unit gets 'infrastructure finance company' statusThe shares of PTC India rose close to 4.84% to Rs 124.50 as the company’s unit PTC India Financial Services (PFS) received the status of an ‘infrastructure financial company’ by the Reserve Bank of India (RBI).

The company received the status on 23 August 2010 after trading hours. The stocks of the company were trading at Rs124 after hitting a high of Rs126 and a low of Rs120. The total traded shares stood at 0.85 lakh shares.

The stocks of the company have outperformed the market over the past one month till 23 August 2010 with an increase of 5.88% compared with the Sensex's 1.54% rise. In the last one quarter it rose 14.96% as against an increase of 11.94% in Sensex.

According to a company statement, the firm has an equity capital of Rs 294.54 crore and the shares have a face value of Rs 10. PTC India has a 77.60% stake in PFS and the status of infrastructure finance company will enable to reduce borrowing costs significantly.

The RBI had announced the IFC as a new category of the non-banking finance company iin February this year. The regulator allows higher exposure for lending and investment to a single borrower or a group of borrowers to such firms. The IFCs can raise external commercial borrowing of upto 50% of their net worth automatically and raise funds through tax-free infrastructure bonds.

PFS has already approved debt and equity assistance aggregating to about Rs 3000 crore to about forth 40 projects in the power sector. The net profit of the firm fell 16.60% to Rs 27.80 crore while net sales rose 16.30% to Rs
2757.56 crore in the first quarter of 2010 compared to the same quarter on 2009.