REC and PFC jump 4%

REC Ltd and Power Finance Corporation Ltd shares rose around 4% in trade after Finance Minister Nirmala Sitharaman, while presenting the Union Budget 2026-27, proposed a restructuring of the organisations, with the stated objective of improving efficiency and strengthening power-sector financing. The move triggered buying interest across power finance names as investors positioned for the potential benefits of a streamlined institutional structure.

The Budget proposal was read as a policy push to sharpen the operating architecture of government-owned power lenders, where mandates can overlap across generation, transmission and distribution funding. While the Budget statement sets the direction, the market will look for clarity on the contours of the restructuring, including timelines, governance and reporting structure, and whether it involves any change in roles, processes, or group-level alignment.

From an earnings and valuation standpoint, the near-term focus will remain on whether restructuring translates into measurable outcomes such as better operating efficiency, improved capital allocation, sharper underwriting focus and stronger execution capacity for India’s power capex cycle. The durability of the stock reaction is likely to depend on subsequent announcements that spell out implementation details and any regulatory steps involved.