2022 will go down as one of the most volatile and uncertain years in the history of the Indian stock market.
From geopolitical concerns to high inflation, and rising interest rates, there was much to worry about.
But 2022 will also be remembered for the resilience of the Indian retail investor.
In a year when foreign investors fled the Indian market, retail investors did not lose hope. This despite suffering major losses in the first half of the year and being disappointed by many big ticket IPOs.
It was the retail fund inflows, via direct and SIP routes, that prevented the market from falling into a bear market. And when the FIIs returned, the Indian market scaled new highs.
One of the big reasons why retail investors kept faith in the market was the steady income they received from dividends.
Dividend stocks have provided stability to their portfolios which in turn has helped bring in more money into the market.
This has proven to investors once again why dividends are so important in a volatile market. They provide investors with a steady income and a moderate return on their investment.
They also provide an incentive for companies to increase their earnings, so they can pay an even higher dividend next year. This is why dividend paying stocks have been shown to have higher returns than non-dividend paying stocks over long periods of time.
Even the father of value investing Benjamin Graham agrees when he says,
The true investor will do better if he forgets about the stock market and pays attention to his dividend returns and to the operation results of his companies.
Investors will be looking for even more dividends in 2023. So here’s a list of 10 dividend stocks to watch out for in 2023…
1. Coal India
Coal India, the state-owned coal mining corporate, is the single largest coal producer in the world. The company operates through 83 mining areas and is spread over 8 states of India.
The company is an apex body with 7 wholly owned coal producing subsidiaries and 1 mine planning and consultancy company.
It produces around 83% of the overall coal production in India and accounts for 76% of total thermal power generating capacity.
It’s a Maharatna company, a privileged status conferred by Government of India to select state owned enterprises to empower them to expand their operations and emerge as global giants.
Despite India’s renewable energy push, we believe Coal is here to stay. It forms a critical part of India’s economy as the largest coal supplier to India’s power sector.
It has declared dividends since 2004. Coal India’s current dividend yield is about 10%.
Here’s a table showing the entire history of dividends paid by Coal India.
Coal India’s Rich Dividend History
2. ICICI Lombard General Insurance
Along with a balanced portfolio, increased focus on profitable segments and strong backing from its parent company, ICICI Lombard General Insurance is a formidable general insurance player in the country.
The company derives managerial and funding support from ICICI Bank, which is reflected in the representation of ICICI Bank’s directors on ICICI Lombard’s board, and the bank’s high involvement in the latter’s functioning.
The stock has remained under pressure this year. On account of the uncertain nature of the pandemic and lockdown orders by the government, the quantum of business sourced by ICICI Lombard has been below the level of business done had there been no lockdown.
In financial year 2022, the company reported a relatively higher underwriting loss due to the elevated loss ratio in the health & personal accident segment.
To know more, check out ICICI Lombard’s dividend payout history.
The stock is trading at a dividend yield of 0.8%. Here’s a table showing the company’s dividend payment history in recent years.
ICICI Lombard’s Dividend History
3. Page Industries
Page Industries is an Indian manufacturer and retailer of innerwear, loungewear, and socks.
It is the exclusive licensee of Jockey International in India, Sri Lanka, Nepal, Bangladesh, the United Arab Emirates, Oman, and Qatar. In 2011, it licensed Speedo swimwear from Pentland Group for India and Sri Lanka.
The company was founded in 1994 by Sunder Genomal and his brothers Nari and Ramesh. Together they hold a 54% stake in it.
For the financial year ending March 2023, Page Industries had declared an interim dividend of Rs 70 per share. The record date for the dividend was 18 November 2022 and it will be paid on or before 9 December 2022.
Page Industries is a consistent dividend payer, having paid dividends since 2004. Over the last 5 years, it has averaged a dividend per share of Rs 244.
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The end-of-year dividend yield of the company is 0.9%. The dividend payout ratio for the year ended March 2022 was 76.9%. The 5-year average stands at 67.9%.
Page Industries Dividend History
4. P&G Hygiene
P&G Hygiene is one of the leading female and healthcare consumer goods companies in India.
Its business is divided into two segments – hygiene and healthcare.
Its well-known brands include Whisper, Oral B, Vicks, and Olay. It has two manufacturing facilities and an extensive distribution network in India.
For the financial year 2022, Procter and Gamble Hygiene declared a final dividend of Rs 65 per share. The record date for this dividend payment is set as 4 November 2022.
Since 2000, the company has declared 28 dividends. The five-year average dividend payout ratio of the company stands at 126%. The dividend yield over the past five years has been 1.9%.
For the financial year 2023, the company has invested Rs 2 bn for liquid detergent facility in Hyderabad.
To know more, check P&G Hygiene’s factsheet and the latest quarterly results.
P&G Hygiene’s Dividend History
5. Gillette India
Gillette India is a subsidiary of P&G USA.
The company has an extensive distribution network comprising drug stores, department stores, and grocery stores.
It manufactures and sells FMCG products in the grooming and oral care segment. It has an extensive product portfolio of razors, blades, shaving gels, and creams.
Some of its well-known brands are Fusion5, MACH3, and Guard3.
For the financial year 2022, Gillette declared a dividend of Rs 36 per share. The record date for the dividend payment is 10 November 2022.
Since 2001, the company has declared 29 dividends. The five-year dividend payout ratio of the company stands at 98.9%. The five-year average yield of the company is 1.5%.
For financial year 2023, the company has launched a flagship campaign ‘Shaving Stereo types’ for the young Indian students.
To know more, check out Gillette India factsheets and its quarterly result.
Gillette India’s Dividend History
6. ITC
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.
In the agri sector, it’s acknowledged globally as a pioneer in farmer empowerment through its wide-reaching agri business. In the hotels segment, it’s a pre-eminent hotel chain in India.
For years, ITC was planning to gradually shift towards an asset-light model in the hospitality sector for further expansion. It’s only now that the words have been put to action.
ITC’s wholly owned subsidiary, ITC Infotech, is a specialised global digital solutions provider.
Over the last decade, ITC has successfully created an array of strong brands which are either #1 or #2. They are market leaders in their respective categories.
ITC has always been considered as an attractive dividend play. Right from humble beginnings in 1994, the company has rewarded investors with a higher payout compared to its peers.
This is the one thing that makes ITC stand out. Over the years, the company’s management has laid out a flexible capital allocation policy. It has said that dividend payouts will be stepped up to about 80-85% of its post-tax profits.
In 1994, ITC began its track record of paying consistent dividends. It paid out a dividend of Rs 8.5 per share and the total payout was around Rs 1,009 m.
In the latest financial year 2021-22, ITC paid out Rs 11.5 per share as dividends and distributed around Rs 64,695 m in dividends.
To put things into context, ITC is paying dividends since 1994 with not a single year of gap in between.
ITC’s dividend payout ratio was 93% in financial year 2021-22. The company has come a long way in increasing this payout ratio. Between 2003 and 2009, the company had a modest payout ratio ranging between 30-40%. The dividend payout ratio peaked in 2021 at 101%.
The following table shows the adjusted dividend paid by ITC to its shareholders between 2018-2022.
ITC India’s Dividend History
7. Oracle Financial Services
For the financial year 2022, Oracle Financial Services declared a final dividend of Rs 189 per share, with a dividend payout ratio of 86.8%. This payout was on the back of a marginal reduction in employee retention costs.
Oracle Financial Services has been a consistent dividend payer. Since 2002, the company has declared 13 dividends. We even covered an in-depth editorial on why Oracle Financial is the greatest dividend stock of all time.
The five-year average dividend payout ratio stands at 75.9%. The dividend yield over the past five years has averaged 4.8%.
Oracle Financial Services is a subsidiary of Oracle Global (Mauritius). With strong in-house R&D centers, Oracle has produced products used by banks in more than 150 countries around the world. Oracle assists in implementing artificial intelligence (AI) in the company and IT processes.
The company has a healthy cash balance of Rs 69 bn as of 31 March 2022, up 3.6% YoY.
With its foray into the sovereign cloud regions with EU-based users, the company is looking forward to expanding its cliental base. This is expected to boost the profits, inching the cash balance higher.
To know more, check out Oracle Financial company fact sheet and quarterly results.
Oracle Financial Services’ Dividend History
8. Hindustan Aeronautics
Hindustan Aeronautics manufactures and maintains aircraft and helicopters for the Indian Airforce, Indian Army, ISRO, Indian Navy, and Indian Coast Guard, among others.
As of March 2022 quarter, it had a healthy cash balance of Rs 143 bn, up 99% YoY. In the financial year 2022, the company declared a final dividend of Rs 50 per share, with a dividend payout ratio of 37%. This payout was due to a 91% jump in the net profit of the firm.
Since 2008, the company has declared 15 dividends. The five-year average dividend payout ratio stands at 75.9%. The dividend yield over the past five years has been 3.6%.
To increase sales, HAL signed a US$716 m deal with GE Aviation for the supplies of engines.
It has also set up a Rs 2.1 bn Integrated Cryogenic Engine Manufacturing Facility (ICMF) that would cater to the entire rocket engine production under one roof for ISRO. This will eventually result in higher profits for the company.
To know more, check out Hindustan Aeronautics company fact sheet and quarterly results.
Hindustan Aeronautics Dividend History
9. Supreme Industries
Supreme Industries is a leader in India’s plastic industry. It is engaged in the production of plastic products and operates in various product categories like plastic piping systems, Cross laminated film and many more.
For the financial year 2022, Supreme Industries declared an interim dividend of Rs 6 per share and a final dividend of Rs 18 per share. The company paid a total of Rs 24 per share, with a dividend payout ratio of 39.9%. The high payout was due to a decrease in the finance cost and an increase in sales.
Since 2000, the company has declared 39 dividends. The five-year average dividend payout ratio stands at 38.1%. The dividend yield over the past five years has been 1.2%.
The cash balance for the financial year 2022 stands at Rs 5.3 bn, down 31% YoY. It was due to higher raw material prices.
For the financial year 2023, to upscale the production, it has planned a capital expenditure of Rs 7 bn across the various segments , including bath fittings, composite LPG cylinders and many more.
To know more, check out Supreme Industries company fact sheet and quarterly results.
Supreme Industries’ Dividend History
10. CRISIL
CRSIL is one of the leading rating agencies in India. It also provides research and risk advisory services.
In the financial year 2022, the company has declared a final dividend of Rs 15 per share, with the dividend payout standing at 72%. The increase in payout was due to the reduction in sales tax and higher sales.
Since 2001, the company has declared 69 dividends. The five-year average dividend payout ratio stands at 66.5%, with a dividend yield of 1.7%.
The company’s rating services span an entire range of debt instruments for over 8,000 companies. It has a presence across the globe and draws most of its revenue from North America, India, and Europe.
Due to the higher demand for research reports due to the prevailing volatile market, the cash balance saw a growth of 5.6% YoY.
Going forward, CRISIL plans to leverage its parent company’s brand (S&P Global) to expand in the international market to boost sales.
To know more, check out CRISIL company fact sheet and quarterly results.
CRISIL’s Dividend History
