REC, PFC Shares Surge Nearly 3%; As PSU Stocks Outperform BSE Sensex in Month, Should You Buy?

REC, PFS share price today: Shares of Rural Electrification Corporation (REC) rose 3% on Thursday, a day after its board of directors approved Rs 1.70 lakh crore worth of borrowing plan for the financial year 2025-26. Additionally, shares of its parent company, Power Finance Corporation (PFC), also surged during Thursday's trading session.

REC share price was trading 2.35% higher at Rs 435.40 per share on BSE during Thursday's intraday trading session. Whereas, PFC scrip was up 2.44% and was trading at Rs 420.30 per share on BSE at 11:20 am.

REC share price

REC share price value has is recovering from its 52-week-low-mark of Rs 357.45 apiece touched on BSE on 28 February 2025. The company share price touched its 52-week low mark of Rs 653.90 on 12 July 2024. REC scrip has outperformed BSE Sensex in the last one month as its value has increased by 15%.

REC share outlook

The Maharatna PSU's assets under management (AUM) are likely to earn a strong CAGR of 16.66% over financial year 2025-27 to Rs 7.9 lakh crore, mainly due to its strong renewable loan portfolio and other infrastructure loans and sanctioned investment, according to Mirae Asset Sharekhan Research.

The public finance lender, on Wednesday, approved a market borrowing program worth Rs 1.7 lakh crore for FY26. The borrowing program will include Rs 1.55 lakh crore raised from instruments like Rupee Term Loans, Capital Gains Tax Exemption Bonds, Domestic Bonds and Debentures, etc. The company will also raise Rs 5,000 crore from commercial papers. The company also approved the appointment of Parminder Chopra CMD Power Finance Corporation as Additional Director on the Board of REC, in effect from 21 March 2025.

Mirae Asset Sharekhan initiates positive outlook for REC

The stock brokerage firm, in its analysis on March 24, initiated a 'buy' call for the Maharatna PSU stock. The stock brokerage, in its note, highlighted REC's healthy returns ratio, improvement in asset book, and healthy growth trajectory, which is likely to fuel the stock growth in coming days.

"Initiate viewpoint coverage with a PT of Rs. 535, potential upside of 20%: Risk-reward appears attractive for REC given steady growth and healthy return ratios. We expect loan book/PAT CAGR of ~16.6%/12.8% for FY25-FY27, along with improvement in asset quality. Growth trajectory is expected to translate into healthy RoA/RoE at >2.6%/>20% in FY27," read Mirae Asset Sharekhan report.

The stock brokerage expects that REC Ltd will make significantinvestment in power sector with special emphasis on renewables capacity, diversification of loan book, and healthy dividend yield.

"We Initiate viewpoint coverage on REC with a PT of Rs. 535. Currently, the stock trades at 1.3x/1.1x of its FY26/FY27 book value. A sustained track record of successful execution and steady healthy ratios are likely to drive re-rating of the stock."

PFC share price trend

PFC share price hit its 52-week low mark of Rs 357.25 per share on BSE on 17 February 2025. The stock has witnessed a growth of 10.81% in the last one month, outperforming BSE Sensex, which has surged merely 4.11% in one month. The company scrip hit its 52-week high mark of Rs 580.35 per share on BSE in July last year.

Mirae Asset Sharekhan fixes positive call for PFC stock

Power Finance Corporation holds around 51% stake in REC. Mirae Asset Sharekhan in its recent analysis report released on March 24, mentioned that the company can achieve a 14% loan CAGR till FY27. Its renewable energy capacity is likely to grow to 500 GW by FY30 and hence present a lucrative opportunity for investors to make gains.

"We initiate viewpoint coverage on PFC with TP of Rs. 560, upside potential 32%: Attractive valuation, resulting in favourable risk-reward," stated Mirae Asset Sharekhan in its report.

"After recent steep correction of more than 25% in the last few months, the risk reward has turned favorable. We expect PFC to deliver a 14% loan book CAGR for FY25-FY27. The growth trajectory is expected to translate into RoA /RoE of >2.8%/17.6% by FY27. On an standalone basis, PFC trades at 1.4x FY27E core BV, and we believe that the risk-reward is attractive considering decent visibility on loan growth, sanctioned loan portfolio of Rs. 2.52 lakh crore."