Post News Network
Bhubaneswar, Feb 18: Following the footprints of Central government with regard to payment of dividend by state owned public sector enterprises, the state government has directed the state PSUs to pay an annual dividend of 30 per cent of profit after tax (PAT) or 30 per cent of state government’s equity.
“A state PSU would pay an annual dividend of 30 per cent of PAT or 30 per cent of state government’s equity, whichever is higher,” a notification by state Finance department said.
Notably, the central government recently revisited the guidelines of paying dividend by central PSUs to its shareholders as per the recommendations of the 14th Finance Commission.
“Operational decisions of a public sector enterprise should lie with the concerned entity, but final decisions relating to dividends and reserves should remain with the government as the owners,” the Centre had said.
Following the same line, the state government has now decided to implement it on state PSUs.
“Due account should be taken of cash and free reserves with the state PSUs and accordingly special dividend would need to be paid to the government as return of its equity investments,” the Finance department letter said. It has also said that state PSUs with large cash/free reserves and sustainable profit may issue bonus shares.
