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Key Points

Public sector companies are proving to be lucrative investment options for income-focused investors. State-run firms like Coal India and Power Finance Corporation are offering substantial dividend payouts that attract long-term shareholders. The BSE PSU index has seen remarkable growth, rising 250% in the past five years due to improved operational efficiency. These companies are demonstrating strong financial performance and delivering consistent returns through strategic dividend policies.

Key Points: Coal India PFC Lead PSU Dividend Payouts Surge

  • Coal India delivers impressive 8.6% dividend yield
  • PFC and REC provide steady 5% shareholder returns
  • PSU index jumps 250% in five years
  • Energy and banking sectors lead dividend distributions
2 min read

State-run firms pay big dividends; Coal India, PFC lead the pack

State-run firms offer attractive dividend yields with Coal India and PFC topping the list of high-return public sector stocks.

"Dividends are the portion of a company's profit distributed to its shareholders - Financial Analyst"

Mumbai, Aug 27

Public sector companies have once again proved to be attractive for investors seeking steady income, as many of them announced hefty dividend payouts over the past 12 months.

For long-term investors, these stocks not only offer capital appreciation but also provide regular income through dividends.

Dividends are the portion of a company's profit distributed to its shareholders, typically paid quarterly, semi-annually, or annually.

Among state-owned firms, Coal India stood out with the highest dividend payout of Rs 32 per share, delivering a dividend yield of 8.6 per cent.

Dividend yield refers to the annual dividend income expressed as a percentage of the stock's current market price -- an important metric for income-focused investors.

Power Finance Corporation (PFC) rewarded shareholders with Rs 19.5 per share -- reflecting a yield of 5 per cent, while REC Limited paid Rs 19.1 per share, also translating into a 5 per cent yield.

Energy giant ONGC distributed Rs 13.5 per share during the year, offering investors a yield of 6 per cent.

Bank of Baroda (BoB) gave out Rs 8.4 per share, though its yield stood at a relatively modest 3 per cent.

NALCO declared a dividend of Rs 10 per share with a 5 per cent yield, while NMDC announced a smaller payout of Rs 4.8 per share, but managed to deliver a higher yield of 7 per cent.

Among others, BPCL also paid Rs 10 per share, translating into a 3 per cent yield, while engineering consultancy firm RITES Limited matched the Rs 10 payout with a yield of 4 per cent.

At the end of the list are BPCL and HUDCO. Oil company BPCL paid a dividend of Rs 10, giving investors a 3 per cent return. HUDCO also gave a dividend of Rs 8.4, which is a 3 per cent return as well.

Meanwhile, the BSE PSU index has gone up by almost 250 per cent in the past five years.

This rise happened because the companies in the index have been performing better, managing their operations well, improving their finances, and benefiting from government reforms.

- IANS

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Reader Comments

P
Priya S
As a retired person, these dividend-paying PSUs have been my go-to for regular income. Much better returns than fixed deposits and the capital appreciation is a bonus. More people should consider this for passive income.
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Michael C
While the dividends are impressive, I hope these companies are also reinvesting sufficiently in growth and modernization. High dividends shouldn't come at the cost of future competitiveness, especially in sectors like energy.
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Ananya R
NMDC's case is interesting - smaller payout but higher yield shows how important current market price is. Timing your entry matters a lot in dividend investing! 📈
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Vikram M
250% growth in PSU index in 5 years is phenomenal! This shows how government reforms and better management have transformed these companies. My father used to avoid PSU stocks, but now they're outperforming many private companies.
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Sarah B
As an NRI investor, I find Indian PSU dividends particularly attractive because of the stable rupee income and growth potential. The yields are much better than what I get from most international blue-chip stocks.

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