PSU Chiefs Meet Jaitley to Discuss Dividends

New Delhi: Heads of several public sector companies today called on Finance Minister Arun Jaitley to discuss dividend payouts and capex plans.

"Every year there is a review by the Finance Minister on the capex expenditure by the PSUs. It was a repeat of the same," NTPC Chairman & Managing Arup Roy Choudhury said after the meeting.

SAIL Chairman C S Verma and BHEL Chairman and Managing Director B P Rao also attended the meeting among others.

Asked whether the Finance Minister demanded higher dividend as the government is grappling with a tough fiscal deficit target of 4.1 per cent, Choudhury said: "Dividend issue was discussed. We never felt government's fiscal position was worse than last year, nobody said so... we all honestly need to pay our dividend. Everybody is doing well."

According to the mid-year analysis tabled in Parliament last month, the fiscal deficit target for the current fiscal year is ambitious.

It had said there was over estimation of Rs 1.05 lakh crore tax revenue in the budget and the amount is "broadly the shortfall that now looms ahead".

The government had set a target of Rs 43,425 crore from sale of its shares in listed companies this year. But only Rs 1,715 crore has been realised from disinvestment proceeds so far.

The government is also banking on dividends to keep its fiscal budget on track.

All profit-making central public sector undertakings (CPSU) are required to declare a minimum dividend payout of 20 per cent of post-tax profit, whichever is higher, subject to the availability of disposable profits.