High Dividend Yield Stocks in India for Long Term

High Dividend Yield Stocks in India for Long Term

 

This article will discuss several points and our main focus part will be High Dividend Yield Stocks.

  • Best Dividend Yield Stocks in India
  • High Dividend Yield Stocks in India
  • Top Dividend Yield Stocks in India
  • High Dividend Yield Stocks.

 

what is a dividend? 

A dividend is an amount that is shared by companies to their shareholders from their yearly profit. The company can reinvest its profits in business for the growth of the company or that profit can be distributed among the shareholders. Dividend payout is decided by the BODs of the company and this needs the approval of the company’s shareholders and after deciding the dividend it can be paid on quarterly or annually basis.

 

Dividends payment follows a sequence of events. There are three dates that investors should understand, let’s have a look at every important date, step by step:

Announcement Date: The date at which companies announce about dividend decision that they are going to issue to their shareholders, and on the same day they also announce the others important days as well, like Ex-date and Record date.

Ex-dividend Date: This date is the last date for dividend eligibility. Means if, the shareholder who is not purchasing the share till this date he will not be eligible for a dividend. Although, if shareholders buy the stock of the company a day before the ex-date will get dividends.

Record Date: The date at which the company defines, who are the shareholders, are eligible for a dividend. That means, if you bought a share of a company a day before the ex-date, then the dividend will be transferred to your bank account or Demat account in T+2 days.

 

What Is Dividend Yield?

Dividend Yield is the sum of money that companies pay to their shareholders over the financial year.

Formula:- Dividend Yield = (Annual Dividend / Share Price)*100

This shows that the total dividend paid by the company during the financial year or over the last four quarters.

Key Notes:

  • Dividend yield is the amount of money that is paid by the company to its shareholder for owning the share of the company
  • This is the estimated one-year return of an investment in stock, paying a dividend is not necessary for every company.
  • Dividend is mainly paid by the mature companies and mainly those are dealing in utility and consumer industries
  • The higher dividend yield is not always a good investment option.

 

Dividend Pay-out Ratio:

It is the total per cent of net income or profit after tax that is distributed as dividends among the shareholders. This is not the gentle way to invest in a stock whose dividend pay-out ratio is greater than 100 per cent as the company will become unsustainable in the longer period.

 

High Dividend Yield Stocks VS Growth Stocks

Investing in a high dividend stock is the best source of income. The problem is, dividend yields are relatively low that is 4-5 per cent (this number is considered as high dividend yield). People need a lot of capital to get meaningful income. Although if you have a 500,000 rupees dividend yield stock portfolio yielding per year around 3 per cent that’s only 15,000 rupees a year. You should ask yourself, is this much of dividend yields return is worth for investment.

Out of some multi-bagger stocks, I’ve had over years, none of them is high dividend yield stocks. I’m pretty sure high dividend yield stocks will give you more than 100% returns if you invest them for a longer period. But if you are a man like me, you would like to build your fortune sooner instead of later. So, before you are going to invest in high dividend stock for a longer period firstly you should focus on how much return you want from your money. Just a nominal return of 4-5% or to earn 20-25% per year by investing in high growth stocks.

 

Now, I am going to share with you the High Dividend Yield Stocks or Best Dividend Stocks in India. Here, I can’t cover the whole list of high dividend-paying stocks but, will try to give you a complete overview of this by mentioning high best dividend stocks in India. The list of high dividend yield stock may vary on year on year basis because of the performance of the company over the period. But for now, these are the best dividend-paying stocks;

List of High Dividend Yield Stocks

Indiabulls Housing Finance Limited:

Indiabulls Housing Finance Limited is a mortgage lender company, headquartered in New Delhi, India. This is India’s second largest housing finance house after the HDFC and regulated by NHB (National Housing Bank). This is a part of Sameer Gehlaut’s Indiabulls group and contributes approximately 80% of the group’s total revenue. Recently on 5 April 2019, the board directors of Indiabulls Housing Finance announced their merger with Lakshmi Vilas Bank. Indiabulls housing finance shareholders will get around 90.5% stake in the consolidated entity, that will be called Indiabulls Lakshmi Vilas Bank, and Lakshmi Vilash Bank will be receiving the remaining part that is 9.5 per cent. The newly merged institution will generate a net worth of rupees 19,472 crores and a loan book rupees 1,23,393 crore for the financial year 2019.

 

Financial Analysis:

Market cap:   12,558 Cr.

Current Price: 293.85

52 Week High/Low:     919.40/165.8

Book Value:   396.96

Stock PE:       3.59

Dividend Yield:            13.61%

ROCE:           12.38%

ROE:              26.53%

Face Value:                 2

 

 

Compounding Sales Growth

Compounding Profit Growth

Stock Price CAGR

Return on Equity

10 Years

NA

NA

NA

NA

5 Years

23.64%

21.19%

-8.37%

27.58%

3 Years

22.67%

20.93%

-23%

27.19%

 

GAIL:

 

GAIL is an Indian government entity. This is one of the largest government-owned natural gas and distribution unit in India, headquarter New Delhi. GAIL is a government-owned entity, under the control of the Ministry of Petroleum and Natural Gas. GAIL has the business segments like natural gas, liquefied petroleum gas transmission, petrochemical, city gas distribution, exploration and production and electricity generation.

 

Financial Analysis:

Market cap:    53,084 Cr.

Current Price:  117.7

52 Week High/Low:      183.26/110.45

Book Value:    105.16

Stock PE:           8.87

Dividend Yield:                 6.07%

ROCE:              21.53%

ROE:                 15.53%

Face Value:                      10

 

 

Compounding Sales Growth

Compounding Profit Growth

Stock Price CAGR

Return on Equity

10 Years

11.95%

8.92%

 0.46%

13.18%

5 Years

4.29%

7.94%

-0.78%

10.36%

3 Years

13.54%

52.83%

-0.58%

12.07%

 

 

HPCL:

Hindustan Petroleum Corporation Limited (HPCL) is a government of India-owned company. Its headquarters is located in Mumbai, Maharashtra. HPCL has about 25 per cent market share in public enterprises in India and strong infrastructure. ONGC, also the second-largest promoter of the company and the first promoter is the President of India, which holds 51.11% shares in Hindustan Petroleum Corporation Limited and other promoters distributed among the FIIs, NIIs, DIIs and retail investor. HPCL holds rank 367th on the Fortune Global 500 list. HPCL was replaced by NIFTY in March 2019. On October 24, 2019, HPCL was granted a Maharatana status.

 

 

Financial Analysis:

Market cap:     40,358 Cr.

Current Price:  264.85

52 Week High/Low:       333.5/211.2

Book Value:     198.16

Stock PE:           7.53

Dividend Yield:                  6.00%

ROCE:               20.38%

ROE:                 23.89%

Face Value:                      10

 

 

Compounding Sales Growth

Compounding Profit Growth

Stock Price CAGR

Return on Equity

10 Years

07.86%

24.63%

12.11%

20.39%

5 Years

03.30%

43.32%

15.85%

28.53%

3 Years

15.69%

12.35%

-02.15%

31.6%

 

 

Infratel:

Infratel is a grower and related infrastructure provider. Infratel is one of the largest grower suppliers in this country. If we talk about the number of growers that Intertel operates and the total number of owned growers, representing 42% of industry equity. They are the pioneers in the field of tower infrastructure in India and own over 39,000+ towers among the operating towers, with some of the towers located in the central and trans region. They also lead the idea of ​​environmentally friendly towers and energy-efficient technologies for the maintenance of these towers.

 

Financial Analysis:

Market cap:     46,573 Cr.

Current Price:  251.80

52 Week High/Low:       335/175.35

Book Value:     69.06

Stock PE:           14.99

Dividend Yield:                  5.96%

ROCE:               20.70%

ROE:                 14.30%

Face Value:                      10

  

 

Compounding Sales Growth

Compounding Profit Growth

Stock Price CAGR

Return on Equity

10 Years

 03.06%

28.55%

 NA%

 09.38%

5 Years

 -08.81%

09.82%

-06.37%

 12.97%

3 Years

07.09%

04.55%

-04.42%

 14.31%

 

 

ONGC:

Oil and Natural Gas Corporation (ONGC) is a government of India-owned company. Its headquarters is located in New Delhi, India. ONGC comes under the Ministry of Petroleum and Natural Gas. ONGC is the biggest oil and gas exploration and production company in India. It contributes around 70% of India’s crude oil (around 57 per cent of India’s total oil demand) and around 84 per cent of natural gas. In November 2010 Government of India awarded the Maharatna status. In a government survey for the FY 2019-20, ONGC was ranked 1st in term of the largest profit-making public sector units in India. ONGC holds the 7th rank among the Top 250 Global Energy Companies by Platts.

 

Financial Analysis:

Market cap:      158,134Cr.

Current Price:   125.70

52 Week High/Low:        178.95/115.55

Book Value:      179

Stock PE:             5.61

Dividend Yield:                   5.57%

ROCE:                19.54%

ROE:                  14.91%

Face Value:                        5

 

 

Compounding Sales Growth

Compounding Profit Growth

Stock Price CAGR

Return on Equity

10 Years

 15.73%

04.77%

 -04.77%

 14.42%

5 Years

 19.33%

03.62%

-11.61%

 11.69%

3 Years

 50.33%

20.62%

-14.32%

 12.76%

 

 

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