The board of state-owned explorer ONGC to finalise the second interim dividend to bail out the government, facing a revenue crunch, and help it to meet the revised fiscal deficit target of 3.4 per cent of GDP.
In a stock exchange filing, ONGC said the board would be meeting on March 23 to consider the interim dividend.
ONGC had initially resisted a government demand for a second interim dividend, stating it did not have the surplus money after announcing an interim dividend of Rs 5.25 per equity share on February 14 and approving a Rs 4,022-crore share buyback.
The PSU had argued that the existing regulations did not allow a company to declare a second dividend within a month of the previous payout and firms need to seek approval of market regulator Sebi to make such a payment.
The government is likely to face a Rs 80,000-crore shortfall in direct and indirect tax revenues, which will make it difficult to meet a revised fiscal deficit target. The government has been tapping cash-rich PSUs for a second interim dividend.
Indian Oil Corp (IOC) has declared a second interim dividend of Rs 1,412 crore for the current financial year. It had stated in a stock exchange filing that its board had approved payment of Rs 1.50 per share, or 15 per cent, in second interim dividend for 2018-19.
Coal India Ltd on March 14 declared a second interim dividend of Rs 5.85 per share.