SHORTSELL STOCK FOR JUNE

POWER FINANCE CORPN:        

PFC has reported NP of 5535 crores for 9 month ended Dec16. In the past, PFC had been restructuring default loans of power companies and treating same as Standard Assets. It resulted in PFC showing  higher income  and lower NPAs.  However revised guidelines has made it mandatory for PFC to classify Restructured Loans as NPAs

Hence PFC can report *Big LOSS for Q4* ( no one time write off) and NP for _12 months will be lower than NP of 9 months_

ASSET QUALITY TO TAKE BIG BEATING. NPAs WILL SPURT TO *DOUBLE DIGIT* AGAINST EXISTING 3%.

*300% rise in NPAs*

Q4 nos will raise issue of corporate governance

Stock looks slated for Downgrade by all brokerage houses due worsening asset Quality.

TP. 120-122 June Expiry