Growth Ratio Summary

Growth Score : 10.00

Power Finance Corporation exhibits strong growth across all measured metrics. The revenue, operating profit, EPS, asset, and net income growth rates are all substantial, indicating robust expansion and improving profitability. This suggests effective strategies in capturing market opportunities and enhancing operational efficiency. Sustaining these growth rates will be critical for long-term success and maintaining investor confidence.

Financial Ratio Summary

Financial Score : 7.60

Power Finance Corporation’s financial ratios present a mixed performance. Adjusted earnings and dividends per share are reasonably high, reflecting positively on shareholder returns. However, the cash earnings per share and book value per share are relatively low, suggesting potential areas for improvement. The company’s effective management of capital expenditures is a positive sign, contributing to its financial stability.

Profitability Ratio Summary

Profitability Score : 9.40

Power Finance Corporation demonstrates strong profitability, as indicated by high gross profit margin, ROCE, ROE, operating margin, and net margin. These metrics suggest that the company is effectively managing its costs and generating substantial profits from its operations and investments. The company is generating good returns on its capital and equity. While the return on assets is moderate, it still indicates a solid ability to generate profit from its asset base.

Efficiency Ratio Summary

Efficiency Score : 4.67

The efficiency ratios for Power Finance Corporation present a mixed picture. The fixed asset, inventory, and receivables turnover ratios are minimal, suggesting underutilization of assets. The days sales in inventory and receivable days are high, meaning the company is very efficient in managing its inventory and collecting receivables. The capital turnover ratio is low, indicating inefficient use of capital to generate revenue. This is likely due to the nature of the business being financial services, where inventory and fixed assets are not as relevant.

Coverage Ratio Summary

Coverage Score : 7.60

Power Finance Corporation demonstrates adequate coverage ratios, highlighting its ability to meet its interest and dividend obligations. The interest coverage ratio indicates that the company can comfortably cover its interest expenses with its earnings. The equity dividend coverage ratio suggests that the company generates enough profit to comfortably cover its dividend payments to shareholders. These factors contribute to financial stability and investor confidence.

Solvency Ratio Summary

Solvency Score : 2.80

Power Finance Corporation's solvency ratios indicate a high level of financial leverage. The high debt ratio, debt-to-equity ratio, and debt-to-asset ratio suggest that the company relies heavily on debt financing. The company's equity ratio is quite low, indicating a dependence on borrowed funds. However, the Debt To Asset Ratio is average, suggesting that a significant portion of the company's assets are financed through debt, which can be a concern if assets do not generate sufficient returns to cover interest expenses and principal repayments.

Liquidity Ratio Summary

Liquidity Score : 2.00

The liquidity position reveals significant challenges for Power Finance Corporation. All the current, quick, and cash ratios are at minimal levels, indicating a struggle to cover immediate liabilities with available assets. The operating cash flow ratio is also negative, adding to the concern. This suggests a high reliance on external funding and potential vulnerability to financial stress if access to credit is limited. On a positive note, this could be typical for a financial institution that rapidly deploys its assets, but it warrants careful monitoring.