PFC Launches Third Public NCD Issue to Raise Up to ₹5000 Crore

Power Finance Corporation (PFC) has launched its third public issue of secured, redeemable non-convertible debentures (NCDs), marking another step in its long-term funding strategy for India’s power sector. The issue opens for subscription on January 16, 2026, and will close on January 30, 2026.

This public bond issue comes after a gap of nearly 30 months and reflects sustained investor interest in PFC’s debt offerings.

PFC NCD Issue Size and Structure

PFC plans to raise up to ₹5,000 crore through this NCD issue. The base issue size is ₹500 crore, with a green-shoe option that allows the company to retain oversubscriptions up to the full amount.

This is PFC’s third public NCD issue and also the first zero-coupon public bond issue by a public sector undertaking (PSU) in the current calendar year. The company’s earlier bond offerings were heavily subscribed, indicating strong demand from investors.

Tenure Options and Investment Features

The NCD issue offers multiple series with different tenures, giving investors flexibility based on their investment horizon and return preferences. Available tenures include:

• 5 years
• 10 years
• 15 years

A key highlight of this issue is the zero-coupon bond option, which is being offered for the first time by a PSU in the public bond market. This option is structured to nearly double the investment over a 10-year period, with returns taxed as long-term capital gains.

Other series offer cumulative interest options, under which investments can grow to nearly three times over a 15-year period. These options cater to both retail and institutional investors looking for long-term, predictable returns.

Strong Financial Position of PFC

PFC plays a central role in financing India’s power sector. The company has funded nearly 50% of India’s installed power capacity, underlining its importance in the country’s energy infrastructure.

As of September 2025, PFC’s loan asset book stood at ₹5.61 lakh crore. In the first half of the current financial year, the company reported a profit of close to ₹8,900 crore, reflecting stable performance and balance sheet strength.

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Conclusion

PFC’s third public NCD issue combines scale, innovation and flexibility, with features such as a zero-coupon bond and long-term cumulative options. Backed by a strong asset base and a key role in India’s power sector, the issue is positioned as a long-term investment opportunity for investors seeking stable returns. The launch also reinforces PFC’s continued commitment to supporting India’s energy transition through sustainable financing.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions. Investments in the securities market are subject to market risks. Read all the related documents carefully before investing.