HUDCO Board Approves ₹70,000 Cr Borrowing Plan and Announces 4th Interim Dividend

Synopsis: Declaring its fourth interim dividend of Rs. 1.25 per equity share for FY26 and fixing March 28 as the record date, HUDCO’s board has also cleared an annual borrowing plan of up to Rs. 70,000 crore for FY27, reflecting the scale of the PSU lender’s planned capital mobilisation as it accelerates disbursements.

A government-backed housing finance institution is back in the spotlight after its board approved a fourth interim dividend for the ongoing financial year, a pace of payouts that puts cumulative interim dividends at four tranches for FY26 alone.

With a market capitalization of Rs. 33,631crore, the shares of Housing and Urban Development Corporation Limited (HUDCO) were trading at Rs. 168 per share, down 4.43 percent from its previous closing price of Rs. 177.09 apiece. It is trading at a P/E of 12.75. HUDCO has an ROE of 15.7 percent and an ROCE of 9.62 percent

Dividend Update

The HUDCO board approved a fourth interim dividend of Rs. 1.25 per equity share on a face value of Rs. 10. Saturday, March 28, 2026, has been fixed as the record date for determining shareholder eligibility, and the company has committed to completing the payment process within 30 days of the declaration. Shareholders have been directed to the TDS communication uploaded on the company’s investor relations portal for tax-related guidance.

Four interim dividends in a single financial year is uncommon and signals a degree of cash flow confidence on the part of management. HUDCO’s dividend payout ratio stood at 31 percent for FY25 per Screener data, so the cumulative quantum for FY26 will be worth watching when the full-year picture emerges.

Annual Borrowing Plan for FY27

At the same board meeting, convened on March 23, 2026, directors approved an annual borrowing programme of up to Rs. 70,000 crore for FY2026-27. The plan spans a broad set of instruments of various types including 54EC Capital Gain Tax Exemption bonds, Subordinated and Perpetual Tier-I and Tier-II Capital bonds, commercial paper, FCNR(B) loans, foreign currency borrowings, External Commercial Borrowings, multilateral institutional funding, and overdraft and working capital facilities. Allocation decisions regarding instruments throughout the year will be made by the Bond Allotment Committee, guided by current liquidity needs. 

Business Overview

Housing and Urban Development Corporation Limited, a public financial institution operating under the Ministry of Housing and Urban Affairs, primarily finances social housing projects, concentrating on the Economically Weaker Sections (EWS) and Low-Income Group (LIG) segments, along with urban infrastructure projects throughout India.

For the quarter ending December 2025, HUDCO’s revenue totaled Rs. 3,431 crore, resulting in a net profit of Rs. 713 crore, against Rs. 2760 crore and Rs. 735 crore respectively in the year-ago period: revenue growth of nearly 24.31 percent year-on-year, with profit growth considerably at around -3 percent, suggesting some pressure on net margins.

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