Investing in dividend-paying stocks is a great way to earn a steady income while also potentially growing your capital. In India, there are a number of stocks that offer high dividends, making them an attractive option for investors.
As we head into 2022, it’s important to be aware of which stocks are offering the best dividends.
In this article, we will take a look at some of the highest dividend-paying stocks in India for 2022. These stocks have been chosen based on their track record of paying dividends, as well as their overall strength as investments.
We will also discuss the potential risks and rewards of investing in these stocks, so that you can make an informed decision about whether or not to invest in them.
Overall, with a well-researched strategy and a keen eye for spotting potential opportunities, investing in high dividend-paying stocks in India can be a smart move for any investor looking to earn a steady income while also potentially growing their wealth.
What is Dividend?
Dividend is a payment made by a company to its shareholders, typically on a quarterly or annual basis. It is a way for the company to distribute its profits among its investors. Dividends can be paid in cash or in the form of stock.
The amount of dividend paid to shareholders is determined by the company’s board of directors and is based on the company’s profits and financial health. Dividend payments can vary from year to year and are not guaranteed.
Some companies may choose not to pay dividends at all, instead opting to reinvest their profits into the company for future growth.
Dividends can be an important factor for investors when considering a stock purchase. Dividend-paying stocks can provide a steady stream of income for investors, even when the stock’s price may not be performing well.
Additionally, dividend payments can also be a sign of a financially stable and well-managed company.
Benefits of Dividend
Regular income
Dividends provide a steady stream of income to shareholders, which can be used to supplement their regular income or reinvested to grow their wealth.
Capital appreciation
Dividend-paying stocks have a tendency to appreciate in value over time, providing shareholders with the potential for capital gains.
Low risk
Dividend-paying stocks are generally considered to be less risky than non-dividend-paying stocks, as they tend to be more established companies with stable earnings.
Tax benefits
Dividends are taxed at a lower rate than other forms of income, providing shareholders with a significant tax advantage.
Indicator of company performance
Companies that pay dividends are often financially stable and have a strong track record of profitability, providing shareholders with confidence in the company’s performance.
Provides a sense of security
Dividends provide shareholders with a sense of security, as they know that they will receive a regular pay-out, even if the stock price is not performing well.
Increases dividend over time
Many companies increase their dividends over time, providing shareholders with an increased income stream over time.
Diversification
Dividends can be used to diversify an investment portfolio, which can reduce overall portfolio risk.
Provides a steady return
Dividends provide a steady return, which can be helpful for investors who are looking for a stable source of income.
Increases shareholder loyalty
Companies that pay dividends tend to have a loyal shareholder base, as shareholders are more likely to hold onto their stock for the long-term.
Best Highest Dividend Paying Stocks in India
Vedanta Ltd
Vedanta Ltd is a multinational mining and natural resources company based in India. It is one of the leading players in the mining industry, with a focus on zinc, lead, silver, copper, iron ore, and aluminium.
The company operates mines in India, South Africa, Namibia, and Australia, and has a presence in over 50 countries worldwide. Vedanta has a strong commitment to sustainable development, and is known for its focus on environmental protection and community engagement.
The company is also a major contributor to the Indian economy, providing employment and supporting local communities through various initiatives.
It has a Market Capitalisation of Rs. 118,857 Crore. The Current Market Price of the share is Rs. 320. It has a PE ratio of 8.31. It has a dividend yield rate of 25.3%.
Oil and Natural Gas Corporation (ONGC)
Oil and Natural Gas Corporation (ONGC) is a state-owned oil and gas exploration and production company in India. It is the largest oil and gas exploration and production company in the country and one of the largest in the world.
ONGC operates in various countries including India, Russia, Vietnam, Brazil, and Egypt. The company’s main operations include exploration, production, refining, and marketing of oil and natural gas.
ONGC also operates a number of refineries and pipelines, and is involved in various research and development activities. The company’s primary focus is on the exploration and production of hydrocarbons, and it aims to meet the growing energy needs of India.
It has a Market Capitalisation of Rs. 185,748 Crore. The Current Market Price of the share is Rs. 148. It has a PE ratio of 4.82. It has a dividend yield rate of 7.11 %.
Bharat Petroleum Corporation Limited (BPCL)
Bharat Petroleum Corporation Limited (BPCL) is a leading Indian state-owned oil and gas company that was founded in 1952. It is headquartered in Mumbai and is one of the largest public sector undertakings in India.
BPCL operates in the refining, marketing, and distribution of petroleum products and natural gas. It has a strong presence in the domestic market and also has a presence in the international market through its subsidiaries.
BPCL also has a strong focus on sustainable development and has implemented various initiatives to reduce its environmental impact.
It has a Market Capitalisation of Rs. 73000 Crore. The Current Market Price of the share is Rs. 337. It has a dividend yield rate of 4.75%.
Indian Oil Corporation Limited (IOCL)
Indian Oil Corporation Limited (IOCL) is a state-owned oil and gas corporation based in India. It is the largest commercial enterprise in the country and is also the country’s largest oil and gas company.
The company operates in various segments such as refining, pipeline transportation, marketing, and exploration and production. It has a vast network of retail outlets and is known for its high-quality products and services.
The company also has a strong presence in the international market, with operations in several countries. Overall, IOCL plays a crucial role in the Indian economy and is a major contributor to the country’s energy security.
It has a Market Capitalisation of Rs. 114,382 Crore. The Current Market Price of the share is Rs. 81. It has a PE ratio of 8.96. It has a dividend yield rate of 10.4%.
Coal India Limited (CIL)
Coal India Limited (CIL) is a state-owned coal mining company in India. It is the largest coal producer in the world and contributes to around 85% of India’s coal production.
CIL operates through eight subsidiaries, each responsible for mining and production in a specific region of India. The company’s main objective is to provide a stable and continuous supply of coal to India’s power plants and other industries.
CIL also focuses on sustainable mining practices, including reforestation and conservation of local ecosystems. However, it has been criticised for causing environmental degradation and displacement of local communities.
It has a Market Capitalisation of Rs. 137,059 Crore. The Current Market Price of the share is Rs. 222. It has a PE ratio of 5.25. It has a dividend yield rate of 7.61%.
National Thermal Power Corporation Limited (NTPC)
National Thermal Power Corporation Limited (NTPC) is a public sector undertaking and India’s largest power generation company. It was established in 1975 and is headquartered in New Delhi.
NTPC operates a diverse portfolio of power plants across the country, with a total installed capacity of over 60 GW. The company also has a presence in the renewable energy sector, with a portfolio of solar and wind power projects.
NTPC’s vision is to be a “world-class company” and it is committed to providing reliable and sustainable power to the nation.
It has a Market Capitalisation of Rs. 161,256 Crore. The Current Market Price of the share is Rs. 166. It has a PE ratio of 9.37. It has a dividend yield rate of 4.21%.
Power Grid Corporation of India Limited (PGCIL)
Power Grid Corporation of India Limited (PGCIL) is a state-owned company that is responsible for the transmission and distribution of electricity in India. The company was established in 1989 and is headquartered in Gurgaon, Haryana.
PGCIL is responsible for maintaining the national transmission network and operates more than 1,20,000 circuit kilometres of transmission lines and 225 substations across the country.
The company also provides consultancy services to other power transmission companies in India and abroad. PGCIL is a critical player in the Indian power sector and plays a vital role in ensuring reliable and efficient transmission of electricity across the country.
It has a Market Capitalisation of Rs. 152,937 Crore. The Current Market Price of the share is Rs. 218. It has a PE ratio of 10.4. It has a dividend yield rate of 5.36%.
NMDC Ltd
NMDC Limited is an Indian government-owned mineral exploration and production company. It is headquartered in Hyderabad, India and is the largest iron ore producer in the country.
The company was established in 1958 and has operations in Chhattisgarh, Karnataka, and Andhra Pradesh. NMDC operates mines and processing plants for iron ore, copper, rock phosphate, limestone, and dolomite.
The company also operates the Bailadila Deposit-11A, which is one of the largest iron ore mines in the world. NMDC is listed on the National Stock Exchange and Bombay Stock Exchange and is also a part of the Nifty 50 index.
It has a Market Capitalisation of Rs. 36,032 Crore. The Current Market Price of the share is Rs. 123. It has a PE ratio of 5.79. It has a dividend yield rate of 12%.
GAIL Ltd
Gail Ltd is a leading energy company that specialises in natural gas exploration, production, and distribution. The company has a strong presence in India and is the largest state-owned natural gas processing and distribution company in the country.
Gail Ltd is also involved in the liquefied natural gas (LNG) business and has several joint ventures with leading global companies in the energy sector.
With a focus on sustainability and environmental protection, the company is committed to providing safe and reliable energy to its customers. Gail Ltd is listed on the National Stock Exchange of India and is a constituent of the Nifty 50 index.
It has a Market Capitalisation of Rs. 65,192 Crore. The Current Market Price of the share is Rs. 99.2. It has a PE ratio of 5.53. It has a dividend yield rate of 6.72%.
REC Ltd
REC Ltd, also known as Rural Electrification Corporation, is a public sector enterprise in India that provides financial assistance to various sectors such as power generation, transmission, and distribution.
It is one of the leading institutions in the country that aims to provide electricity to rural and remote areas. The company was established in 1969 and has been instrumental in electrifying over 8,000 villages and providing power to millions of households.
It also offers various loan schemes and services to help small and medium-sized enterprises in the power sector. With a strong focus on sustainable and renewable energy, REC Ltd is committed to providing reliable and affordable power to all.
It has a Market Capitalisation of Rs. 30,322 Crore. The Current Market Price of the share is Rs. 115. It has a PE ratio of 2.96. It has a dividend yield rate of 9.97%.
Conclusion
In conclusion, the Indian stock market offers a plethora of options for investors looking for high dividend paying stocks. The above-mentioned companies have consistently paid out dividends to shareholders and have a strong track record of financial performance.
However, it is important to note that investing in any stock carries risk and should be done after thorough research and analysis. Additionally, it is crucial to diversify your portfolio and not solely rely on dividend paying stocks as a source of income.
Overall, these stocks can be a great addition to an investor’s portfolio and can provide a steady stream of income.