State-Run Firms Pay Big Dividends; Coal India, PFC Lead The Pack
New Delhi: 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. (Also Read: Hurry! Indian Bank And IDBI Bank Special FDs Offering Up To 7.45% Interest, The Deadline Is…)
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. (Also Read: Bank Holidays In September: Banks Will Remain Closed On THESE Dates Next Month – Full List Inside)
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.