The Department of Investment and Public Asset Management (DIPAM) has unveiled revised guidelines for Central Public Sector Enterprises (CPSEs), focusing on dividend payments, share buybacks, bonus share issuance, and stock splits. These updates replace the earlier 2016 rules, aligning with current market dynamics to enhance operational efficiency and investor participation.
DIPAM Secretary Tuhin Kanta Pandey highlighted the forward-looking nature of the guidelines, stating, ‘These changes consider market realities, offering CPSEs greater flexibility to push capital expenditure and foster economic growth.’
Key Highlights of the Revised Guidelines:
- Dividend Payments:
- CPSEs will now pay a minimum annual dividend of 30% of Profit After Tax (PAT) or 4% of net worth, whichever is higher, subject to legal provisions.
- For financial sector CPSEs, the 30% PAT minimum is retained.
- Unlisted CPSEs are required to declare a final dividend annually based on audited financial results.
- Share Buybacks:
- CPSEs with shares consistently trading below book value for six months, a net worth of at least ₹3,000 crore, and a cash balance exceeding ₹1,500 crore, are encouraged to consider buybacks.
- Bonus Shares:
- CPSEs with reserves and surplus 20 times or more of their paid-up equity share capital can issue bonus shares.
- Stock Splits:
- Listed CPSEs with share prices exceeding 150 times their face value for six months may consider share splits, subject to a mandatory three-year cooling-off period between splits.
These guidelines exclude public sector banks, insurance companies, Section 8 companies under the Companies Act, 2013, and entities restricted from profit distribution.




























