PPFCF holdings Power Grid Corporation PPFCF holdings PPFAS Mutual Fund PSU contrarian Transmission monopoly Rajeev Thakkar

Power Grid Corporation at PPFCF

From WebNotes, a public knowledge base. Last updated 16 May 2026. Reading time ~12 min.

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Power Grid Corporation of India Limited (Power Grid) is one of the top three domestic equity holdings of the Parag Parikh Flexi Cap Fund (PPFCF) in the April 2026 disclosure. The April 2026 factsheet, reflecting AUM of Rs 1,40,949 crore (up 9.29 per cent month-on-month from Rs 1,28,966 crore in March 2026), showed Power Grid at 6.99 per cent of net assets, behind HDFC Bank at PPFCF at 7.94 per cent and ahead of Coal India at PPFCF at 5.95 per cent.

The position is widely cited as a canonical illustration of PPFAS contrarian investing applied to Indian public-sector undertakings (PSUs). For much of the 2014 to 2021 period the Indian listed-PSU complex was structurally under-owned by domestic mutual funds and by foreign portfolio investors. Concerns around governance, capital allocation, government share-sale overhang and the broader rotation into private-sector growth franchises kept PSU valuations depressed. PPFAS Mutual Fund was among the few large value-oriented houses to build a meaningful position in Power Grid during this period.

The Power Grid thesis combines several PPFAS doctrines. First, PPFAS margin of safety : the stock traded at low single-digit price-to-earnings and price-to-book multiples for extended periods despite a regulated-return business model. Second, the transmission-monopoly nature of the business: Power Grid owns and operates over 85 per cent of India’s inter-state electricity transmission network under a regulated-return framework set by the Central Electricity Regulatory Commission (CERC). Third, dividend yield and steady cash flows. Fourth, the broader PPFAS value investing discipline of buying durable franchises when sentiment is poor.

This article documents Power Grid’s role in PPFCF: the company background, the regulated-monopoly thesis articulated by Rajeev Thakkar and Raunak Onkar , the position history through the 2026 top-three ranking, recent positioning, and the comparison with peer holdings.

Company background

Power Grid Corporation of India Limited was incorporated on 23 October 1989 under the Companies Act, 1956 as the National Power Transmission Corporation Limited, with the objective of establishing a national electricity transmission grid. The company was renamed Power Grid Corporation of India Limited in October 1992. It received Maharatna status in October 2019, making it one of the elite group of central public sector enterprises with significant operational and financial autonomy.

The Government of India is the controlling shareholder, holding approximately 51 per cent of the equity through the Ministry of Power. The remaining shareholding is held by domestic and foreign institutional investors, mutual funds and retail investors. The company’s equity shares are listed on the National Stock Exchange and the Bombay Stock Exchange and are constituents of the Nifty 50 and the Sensex .

Power Grid’s primary business is the planning, design, construction, operation and maintenance of high-voltage electricity transmission systems. The company owns and operates approximately 1,77,000 circuit kilometres of transmission lines and 281 substations as of recent disclosures. It also operates a national telecommunications backbone using surplus capacity on its transmission infrastructure and provides consultancy services to other transmission utilities in India and abroad.

The official corporate website is powergrid.in . The registered office is at Gurugram in Haryana. The company is regulated by the CERC, which sets transmission tariffs on a regulated-return basis (typically 15.5 per cent return on equity post-tax for new projects, subject to operational performance and timely commissioning).

For Indian retail investors, exposure to Power Grid is straightforward through direct equity purchase on the NSE/BSE or through diversified equity mutual fund schemes. PPFCF’s exposure delivers indirect ownership through a SEBI Mutual Funds Regulations 1996 registered scheme.

Investment thesis at PPFCF

The PPFAS thesis on Power Grid combines regulated-monopoly economics with deep-value entry pricing. The argument has been articulated in monthly factsheets and at the PPFAS Annual Unitholders Meet .

First, regulated-return economics. Power Grid earns a regulated return on its asset base under the CERC tariff framework. The return on equity (typically 15.5 per cent post-tax for new projects) is set by regulation, providing predictability that is rare among Indian businesses. Operational performance bonuses and availability incentives can lift effective returns higher. This makes Power Grid’s cash-flow profile closer to an infrastructure utility than an Indian equity, which has implications for valuation.

Second, transmission monopoly. Power Grid owns and operates the bulk of India’s inter-state transmission network. While the regulatory framework allows for private-sector participation through Tariff-Based Competitive Bidding (TBCB), Power Grid has retained a dominant share through both nominated allocations and competitive wins. The network effect of an integrated national grid creates high barriers to entry for new entrants.

Third, PPFAS margin of safety . During the build period, Power Grid traded at low single-digit price-to-earnings multiples (often below 10x) and at price-to-book multiples close to 1.5x to 2.0x. For a business earning regulated returns and growing its asset base, the team argued the valuation was excessive relative to the underlying economics.

Fourth, dividend yield. Power Grid has been among India’s highest-paying dividend stocks, with yields often in the 4 to 6 per cent range during the build period. For a tax-aware fund operating under PPFAS tax-aware portfolio management discipline, the yield component meaningfully contributed to total return.

Fifth, PPFAS contrarian investing discipline. PSU stocks were widely under-owned during 2014 to 2021. PPFAS was among the few houses to build positions in Power Grid (and later Coal India at PPFCF ) when consensus was negative. The team’s willingness to hold through the slow phase paid off when the PSU complex re-rated meaningfully in 2023 to 2026.

Sixth, the energy-transition tailwind. As India scales up renewable energy generation, the transmission infrastructure required to evacuate power from solar and wind clusters in Gujarat, Rajasthan and Tamil Nadu to demand centres elsewhere has been growing. Power Grid is the natural beneficiary of this capacity expansion, with the regulatory framework allowing it to deploy capital and earn regulated returns.

Position history

Power Grid has appeared in PPFCF disclosures across multiple periods. The position was built incrementally during 2018 to 2022 when PSU valuations were depressed. The February 2022 SEBI MF overseas investment cap freeze created a structural pivot in which incremental inflows had to be deployed domestically. PSU positions including Power Grid and Coal India became natural recipients of this redeployment given their attractive valuations and dividend yields.

Through 2023 and 2024 the PSU complex re-rated meaningfully as government capital-expenditure plans, energy-transition investments and balance-sheet improvements lifted earnings and sentiment. Power Grid moved from being a deep-value position to a top-tier PPFCF holding. By the April 2026 disclosure, Power Grid was the second-largest equity holding at 6.99 per cent of net assets, behind HDFC Bank at 7.94 per cent and ahead of Coal India at 5.95 per cent.

The April 2026 ranking represents the formal arrival of the PSU contrarian thesis in the top tier of PPFCF. The combination of Power Grid (6.99 per cent) and Coal India (5.95 per cent) accounts for nearly 13 per cent of the portfolio, alongside private-sector banking and global-technology anchors.

Recent positioning

The April 2026 PPFCF factsheet showed Power Grid at 6.99 per cent of net assets within an AUM of Rs 1,40,949 crore. The May 2026 commentary on PPFCF carrying around 18 to 22 per cent in PPFAS cash holdings reflected broader valuation caution across the equity sleeve, but Power Grid has remained a core position.

In monthly factsheet commentary, Rajeev Thakkar and Neil Parag Parikh have referenced Power Grid’s regulated-return economics and the energy-transition capital-expenditure cycle as supports for the thesis. The team has indicated that valuations of select PSU names remain attractive on a relative basis even after the 2023 to 2026 re-rating.

Comparison with peer holdings

Within PPFCF, Power Grid sits alongside Coal India as the two PSU anchors, alongside HDFC Bank, ICICI Bank, Kotak Mahindra Bank, Bajaj Holdings, ITC, Maruti Suzuki, Mahindra and Mahindra, the technology cluster (Infosys, TCS, HCL Technologies, Persistent Systems), pharmaceuticals (Cipla, IPCA Laboratories) and rating-agency ICRA.

Compared with HDFC Bank, Power Grid offers regulated-return economics rather than retail banking. Compared with Coal India, Power Grid is asset-heavy but operationally lower-risk (commodity-price exposure is limited). Compared with international anchors Alphabet, Microsoft, Amazon and Meta, Power Grid provides rupee-denominated regulated cash flows that complement the dollar-revenue exposure of the foreign sleeve.

Within the broader PPFAS focused portfolio and PPFAS contrarian investing framework, Power Grid is a textbook illustration of the doctrine: a deep-value entry into a high-quality regulated business when the market was overlooking the PSU complex, held patiently through years of underperformance, and rewarded with significant re-rating.

Context within PPFCF

PPFCF was launched on 24 May 2013 as Parag Parikh Long Term Value Fund (PPLTVF), renamed Parag Parikh Long Term Equity Fund on 16 February 2018 and renamed Parag Parikh Flexi Cap Fund on 13 January 2021. The scheme is benchmarked against the Nifty 500 TRI and has delivered a compound annual growth rate since inception of approximately 19.06 per cent against a category average of 15.22 per cent and the Nifty 500 TRI at 12.4 per cent. AUM crossed Rs 1 lakh crore in May 2025, making PPFCF the first active equity mutual fund scheme in India to do so, and rose to roughly Rs 1.6 lakh crore by 15 May 2026.

The fund is managed by Rajeev Thakkar along with Raunak Onkar , Raj Mehta , Rukun Tarachandani and other team members. Parag Parikh , the founder of the Parag Parikh Financial Advisory Services Limited sponsor entity, established the investing house in 1979 and incorporated PPFAS Ltd in December 1992. The mutual fund was set up with SEBI on 10 October 2012 under registration ID MF/069/12/01.

Power Grid’s emergence into the PPFCF top three has been a recurring topic at the PPFAS Annual Unitholders Meet . The 12th edition was held on 22 November 2025 at Birla Matushree Sabhaghar in Mumbai.

External references

Power Grid Corporation of India Limited: powergrid.in
Central Electricity Regulatory Commission: cercind.gov.in
PPFAS AMC factsheet archive: amc.ppfas.com/downloads/factsheet
PPFAS scheme page (PPFCF): amc.ppfas.com/schemes/parag-parikh-flexi-cap-fund
SEBI: www.sebi.gov.in
AMFI member page: amfiindia.com/member/64

References

PPFAS Mutual Fund, October 2025 factsheet, amc.ppfas.com .
PPFAS Mutual Fund, March 2026 factsheet, amc.ppfas.com .
INDmoney, “PPFAS Flexi Cap April 2026 portfolio update,” indmoney.com .
Angel One, “Parag Parikh Flexi Cap Fund crosses one lakh crore AUM,” angelone.in .
Business Today, May 2026 cash commentary, businesstoday.in .
Power Grid Corporation of India Limited, Annual Report 2024-25, powergrid.in .
Central Electricity Regulatory Commission, Tariff Regulations.

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Last reviewed: 16 May 2026
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