Historically, buying dividend stocks has helped insulate investors against inflation. (File)
If you are looking for some immediate payouts, here are four stocks with hefty dividend payments around the corner.
Updated: February10, 2023 12:52 pm IST
Many economists and investors believe that 2023 will be a tumultuous year.
There is no way to predict where the stock market or the economy will go, given the high level of inflation and a Federal Reserve that appears committed to combating it whether or not a cheerful arrival is possible.
Due to this ambiguity, a lot of individual investors managing their portfolios are skeptical about where to invest extra funds in 2023.
One method to gain the inflation-fighting advantages of equities is to seek stocks that have historically outperformed when inflation is high.
A great strategy to overcome this difficulty is also a great way to generate consistent, long-term investment income. This method entails investing in stocks that not only pay dividends but also pay increasing and steady amounts over time.
Historically, buying dividend stocks has helped insulate investors against inflation.
If you are considering investing in dividend stocks to beat inflation, here are four stocks paying more than 500% dividends in February 2023.
#1 TV Today Network
First on the list is TV Today Network.
The company’s board has approved a special interim dividend of ₹ 67 per equity share, which is 1,340% of the face value of the company’s shares.
The record date for the same is 13 February 2023.
TV Today Network has maintained a good record of dividends and consistently declared dividends for the last five years. It has declared a total of 21 dividends since 2004.
The five-year average dividend payout ratio stands at 27.6%. The dividend yield over the past five years has averaged 3.3%.
TV Today Network is engaged in broadcasting, television news channels, radio stations and newspaper publishing in India.
The company is a part of the India Today group and comprises four news channels – Aaj Tak, Headlines Today, Tez, and Dilli Aaj Tak.
TV Today Networks’ Dividend History
#2 Coromandel International
Second on the list is Coromandel International.
For the financial year 2023, this fertilizer company has declared an interim dividend of ₹ 6 per share (representing 600% on face value).
This dividend was on the back of a 38% YoY rise in the profit to ₹ 5.3 billion (bn) and steady operational performance in a challenging macroeconomic environment in the December 2022 quarter.
The record date for the same is 17 February 2023. It has declared a total of 34 dividends since 2001.
The five-year average dividend payout ratio stands at 27.3%. The dividend yield over the past five years has averaged 1.6%.
Coromandel International is one of the leading agri-solutions providers in India. It has a diverse range of products and services and specializes in fertilizers, crop protein, bio-pesticide, and organic fertilizers.
Coromandel International’s Dividend History
#3 ITC
Third on the list is ITC.
On the back of a 21% YoY rise in the profit for the December 2022 quarter, ITC, has declared an interim dividend of ₹ 6 per share for the financial year 2023.
The record date for the same is 15 February 2023.
In 1994, ITC began its track record of paying consistent dividends. It paid out a dividend of ₹ 8.5 per share, and the total payout was around ₹ 1,009 m. Since then, it has paid a continuous dividend with not a single year of gap in between.
It has declared a total of 25 dividends since 2001.
The five-year average dividend payout ratio stands at 75.9%. The dividend yield over the past five years has averaged 3.9%.
ITC is a diversified conglomerate with businesses spanning fast-moving consumer goods, hotels, paperboards and packaging, agri-business, and IT.
The company is the country’s leading FMCG firm and the market leader in the Indian paperboard and packaging industry.
ITC has declared a higher dividend payout compared to other largecap companies. For a detailed comparison, check out ITC or Coal India – which is the better dividend stock?
ITC’s Dividend History
#4 PCBL
Last on the list is PCBL.
The company’s board has declared an interim dividend of ₹ 5.5 per share for the financial year 2023. This was on the back of a 17% YoY rise in revenue due to a rising share of specialty grade carbon black and an increase in sales in international markets amid lower supply from China.
The record date for the same is 10 February 2023. The company has declared a total of 21 dividends since 2002.
The five-year average dividend payout ratio stands at 14.4%. The dividend yield over the past five years has averaged 4.5%.
Philips Carbon Black (PCBL) is a part of the RP-Sanjiv Goenka Group, India’s youngest business group.
The company is the largest Carbon Black producer in India. It is a large conglomerate, having interests in power and natural resources, carbon black retail, FMCG, IT, sports and many more.
PCBL’s Dividend History
Why dividend stocks are gaining attention
Usually, dividend stocks are thought of as a safety play in the stock market. So, when there’s a lot of volatility going on, investors gravitate more towards dividend payers.
Currently, with the market experiencing interest rate hikes, supply chain issues, and struggle in major stock indexes, investors are rushing to companies promising regular payouts to shareholders.
This is because High inflation and rising interest rates eat away at the value of companies’ future earnings while increasing the attractiveness of cash today.
Further, fundamentally strong companies usually pay dividends at a growing rate. This increases the amount of passive income every year.
However, funneling excess cash into dividend stocks may produce income in the short term, but it’s not a quick financial fix. Plan on keeping your money invested for five years or more. That timeline can help you avoid unnecessary capital losses.
If you are interested in investing in dividend stocks, you should investigate the company’s history of dividend payments and their value before investing.
Disclaimer: This article is for information purposes only. It is not a stock recommendation and should not be treated as such.
This article is syndicated from Equitymaster.com