Bernstein has lowered its target prices and growth estimates for Power Finance Corporation (PFC) and REC Limited, citing stronger competition from banks, slower renewable capacity additions and improving financial health among state-owned power distribution companies, or DISCOMs.
The brokerage retained its Outperform rating on both stocks but reduced its target price for PFC to Rs 465 from Rs 500. It also lowered the target for REC to Rs 410 from Rs 420. Based on the August 21 closing prices, these targets imply potential returns of around 37% for PFC and 41% for REC.
