In a pivotal move aligning with Finance Minister's Budget 2026-27 vision, Power Finance Corporation (PFC) Board's in-principle approval paves the way for restructuring via merger with REC Limited. PFC recently acquired the government's 52.63% stake in REC following CCEA's nod, positioning PFC as the holding company with REC as its subsidiary. This consolidation aims to streamline operations in India's power financing sector, enhancing efficiency amid energy transition goals. The merger will be crafted to retain PFC's status as a "Government Company" under the Companies Act, 2013, ensuring continuity in public sector mandates. A detailed scheme will follow requisite regulatory approvals, potentially unlocking synergies in lending for renewables and infrastructure. This restructuring underscores government's push for leaner PSUs, boosting capital access for power projects while mitigating NPA risks through integrated balance sheets. Market watchers anticipate a stronger entity dominating infra finance.