Canara Bank is one such example. Its stock has fallen 1% over the past year, but its total return stood at 3%, courtesy of one of the highest payout ratios among PSUs. Total return combines stock price performance with dividends distributed during the period.
Similarly, SBI has managed a positive total return despite its stock slipping 1.4%. Other PSUs with lower stock returns but higher total returns include NMDC and Union Bank of India.
In fiscal year 2025 (FY25), NMDC distributed 43% of its profit as dividend, while Union Bank of India paid out ₹3,626 crore—representing 47.5% of its bottom line. NMDC, known for its consistent track record of rewarding shareholders, has averaged a dividend of nearly 793% over the past five years. Its latest annual report highlighted a net worth of ₹29,579 crore, alongside an interim dividend of ₹2.30 per share and a final dividend of ₹1.00 per share.
Among PSUs, Gujarat Mineral Development Corporation has been the top performer over the past year, rallying 40%. It was followed by Bharat Electronics, Garden Reach Shipbuilders, National Aluminium Company, and Indian Bank, which gained between 20% and 28%.
On the flip side, Punjab National Bank has been the worst performer, slumping 50.4%, while Rail Vikas Nigam, UCO Bank, REC, and Central Bank of India each fell about 42% over the same period.
PSUs, known for their generous dividend payouts, also boast higher dividend yields. The dividend yield of the BSE PSU index stands at 2.5%, nearly double that of the Sensex at 1.3%. By comparison, the broader BSE 500 index offers a yield of just 1.2%, Bloomberg data show.
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(Edited by : Poonam Behura)