New Delhi: The government has introduced a new 'consistent dividend policy' under which public sector undertakings (PSUs) will be paying between two to four interim dividends in a financial year to ensure continuity of dividends for shareholders, said Department of Investment and Public Asset Management (DIPAM) Secretary Tuhin Kanta Pandey. Speaking at the Directors' Dialogue Series organised by the Institute of Directors on Wednesday, Pandey said that several PSUs have already paid interim dividends in this financial year.
"We have announced a consistent dividend policy, therefore dividends are ensured. The dividend policy has been further fine-tuned to say that we need not wait for annual dividend, and we can have as many as four interim dividends in every quarter in some of the companies or maybe twice in a year," said the DIPAM Secretary. He explained that a consistent dividend policy is something that rewards shareholders which include insurance companies, mutual funds.
The DIPAM Secretary said that the government has decided not to go for repeated offerings of the same stock or have equity exchange-traded fund (ETF) in the markets because of their price overhang concerns. "We have brought in several changes in the memorandum of understanding (for public sector companies) in terms of criteria," he said. The Secretary explained that going forward, the government will place a lot of importance on criteria like asset monetisation plan, return on equity and return on capital.
The government has so far received Rs 28,358.97 crore as dividend from PSUs, according to the data shared by the DIPAM website. Recently, several PSUs have announced interim dividends for their shareholders. The list of such companies include Coal India Ltd (CIL), Oil & Natural Gas Corporation (ONGC), Indian Railway Finance Corporation (IRFC), Hindustan Aeronautics Ltd (HAL), Bharat Electronics Ltd (BEL), Power Grid Corporation of India Ltd (PGCIL), Mazagon Dock Shipbuilders, IRCON International, among others.
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