Public sector undertakings (PSUs) will likely distribute an unprecedented Rs 1.3-1.4 lakh crore in dividends this fiscal year, benefiting both the government and retail investors.
This surge in payouts aligns with PSUs’ projected profits surpassing Rs 3.5 lakh crore for the first time, marking a 10% increase over the previous year.
In line with government directives, the Department for Investment and Public Asset Management (DIPAM) and the Department of Public Enterprises (DPE) are ensuring compliance with dividend policies that require at least 30% of profits or 4% of net worth, shared with investors.
Arunish Chawla, Secretary of DIPAM and in charge of DPE stated, “We envision public enterprises as role models in the stock market, and we encourage the private sector to follow suit. By declaring fair dividends, we aim to restore the confidence of ordinary investors in the stock market.”
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Out of 266 PSUs, 66 trade on stock exchanges.
The higher dividend payouts will likely yield an additional Rs 10,000 crore for the government, potentially aiding in fiscal deficit management, currently at 4.8% of GDP.
The government has allocated Rs 2.9 lakh crore in total dividend receipts, incorporating contributions from the Reserve Bank of India, public sector banks, and insurance firms.
Capital expenditure by central PSUs is estimated to reach Rs 3.8 lakh crore this fiscal, with projections rising to Rs 4.3 lakh crore in 2025-26.
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