Athira Sethu
Kochi, 13 Jan 2026
A government-owned corporation, Power Finance Corporation Limited (PFC), plans to raise funds up to ₹5,000 crores through the sale of public bonds. The sale of the public bonds would begin from January 16 and Remain Open for two weeks. These bonds would be available to all types of investors, including retail ones.
Earlier, PFC has cancelled three private bond issues in the months of November and December. The bond issues were only for selected investors. The company has cancelled the bond issues as rates of interest were fluctuating a lot. This happened even when Reserve Bank of India reduced the rates of interest in December.
PFC’s Chairman and Managing Director, Parminder Chopra, said that the company has been holding out for the market to stabilize before again raising funds. He also stated that the public bond system is the best mechanism for the company to raise funds from Indian citizens.
The bond will begin with ₹500 crore, but PFC can raise additional funds up to ₹5,000 crore if many people invest. The bond will be available for 5 years, 10 years, and 15 years.
The rates of interest for these bonds would be between 6.85% and 7.05%. This is lower compared to previous proposals, and the move would help the PFC cut costs associated with paying interest.
In the past, PFC intended to issue bonds with higher interest rates, but later abandoned the move since the rate for government bonds increased. With increased rates for government bonds, borrowing money becomes expensive for firms.
For the first time, PFC introduces zero coupon bonds. There is no interest paid every year for such bonds. The interest is given in full when the bond matures. This bond has been issued for large investors, rich people, and small investors.
This is the first bond offering by PFC after a period of over two years. Of late, the company has resorted to term loans from banks, as these are cheaper than bonds when the market is volatile.
