India's Power Finance, REC inch up after UBS starts coverage with 'buy'

REC

29/08/2024 05:40

** Shares of Power Finance Corp Ltd  PWFC.NS  and REC Ltd
 RECM.NS  up 1.3% and 1.6%, respectively
    ** UBS starts coverage of power financing stocks with "buy"
rating for both, and PT of 670 rupees and 720 rupees,
respectively
    ** Brokerage believes companies would benefit from India's
transition to renewable power, which provides visibility on loan
growth in "mid-teens"
    ** Sees share of loans for renewables and infrastructure
capex doubling to 40% by FY29, which would also help cos' asset
quality
    ** Cos, which have combined gross bad loans worth 300
billion rupees ($3.58 billion), could see provision write backs
of up to 40 billion rupees due to increased "buyer interest" in
stressed assets - UBS
    ** Analysts rate PWFC "strong buy" on avg, while RECM rated
"buy" - LSEG data
    ** PWFC up ~43% YTD, RECM has jumped 52.3% so far this year


($1 = 83.9020 Indian rupees)

 (Reporting by Nandan Mandayam in Bengaluru)
 ((Nandan.Mandayam@thomsonreuters.com; Mobile: +91 9591011727;))