The Centre’s dividend receipts from Central Public Sector Enterprises (CPSEs) will likely cross Rs 50,000 crore in FY23, as against the revised estimate (RE) of Rs 43,000 crore for the year, thanks to robust payouts by energy, power and commodity firms.
Dividend revenue from the CPSEs in February and March would be aided by fresh payments by Coal India, Oil and Natural Gas Corporation, NHPC, Power Grid, Power Finance Corporation and NMDC, an official said.
Like in FY22, higher energy and commodity prices have boosted the earnings of CPSEs in these sectors significantly. ONGC’s additional dividend of Rs 2,960 crore by March 16 would be enough for the government to reach the RE for FY23.
Among others, Coal India would be shortly paying a tranche of Rs 2,240 crore while NTPC would pay another Rs 2,100 crore dividend.
Despite windfall taxes on domestic crude production, ONGC reported a robust 26% year-on-year rise in net profit to `11,045 crore for the quarter that ended December 31. Similarly, Coal India’s post-tax profit during Q3FY23 rose sharply by 69% on year to Rs 7,719 crore.
Higher dividends by CPSEs could act as a buffer for the government if it falls short of meeting the revised disinvestment target of Rs 50,000 crore for the current financial year. Disinvestment receipts stood at Rs 31,106 crore so far in FY23 or 62% of the RE. The government is banking on the sale of a portion of its residual 29.54% stake in Vedanta-controlled Hindustan Zinc to meet the disinvestment target for FY23.
Following about Rs 30,000 crore shortfall in dividend/surplus receipts from the Reserve Bank of India in FY23, the Centre has lowered dividend receipts from banks and financial institutions by 45% to Rs 40,953 crore in FY23RE.
Officials are confident that the Centre would be able to meet Rs 2.62 trillion non-tax revenue target as per FY23RE, which was marginally lower than Rs 2.69 trillion set in BE.
ONGC has paid Rs 7,409 crore to the government in dividends so far in FY23, 7% more than Rs 6,916 crore for the whole of FY22. Similarly, Coal India dividend payments to the Centre at Rs 7,336 crore so far in FY23, too, have surpassed the `7,132 crore it paid in the whole of FY22.
The Centre had garnered Rs 59,000 crore in dividends from CPSEs in FY22, 28% more than the target of Rs 46,000 crore for the year, thanks to a sharp rise in prices of commodities like metals, mining and petroleum, which boosted the profits of these firms.