Top Highest Dividend Paying Stocks In India 2022

What is Dividend?

Dividend also known as the profit given to shareholders as a part of their shares within a company. Dividend are distributed quarterly and paid out in form of cash or compensation of reinvestment in other stocks

What is Dividend Yield?

Dividend Yield, also can be calculated as a financial ratio that shows how much a company pays out as dividend relative to it’s stock price each year.

A company’s shareholders are eligible to receive a distribution as long as they own stock before the ex-dividend date

Why to choose dividend paying stocks for investment?

Investors who take low-risk usually prefer to invest in high-dividend yield stocks, that mostly don’t give a regular income but provide safety from daily, monthly and yearly share alteration.

Investors expect capital gain that brings higher risk as they cannot be certain of stock price rise for a certain period of time. To contrast this, dividend income is more profitable relative to time.

How to choose Dividend Paying Stocks?

Investors always look up at those companies who not only pay regular dividends but also grow every year.

A company pays a dividend from their net profit, therefore the dividend can grow corresponding to the company net profit growth.

Investors can look at a company's profit and loss accounts to check if the profits are growing along with the dividend. If a company's profits are growing with the company's dividends then it’s likely a long term investment company.

List of stocks with High Dividends Pay

INEOS Styro

Average dividend - Rs. 105

Average dividend payout(in percentage%) - 1050%

IOC

Average dividend - Rs. 24

Average dividend payout(in percentage%) - 24%

Hindustan Global

Average dividend - Rs. 50000

Average dividend payout(in percentage%) - 50%

Investors looking for steady income and less risk investment should invest in high dividend stock paying rather than hope of rise in capital investment.

Why should you start investing?

Investing can benefit to maintain savings and reach long-term financial goals such as retirement and wealth building. This let your savings have traditional bank account to earn little or no interest, so that inflation will remove value of your hard-earned capital. Investment in assets such as stocks and bonds, save your keepings with and without inflation.

Short term savings like high-yield stocks or mutual fund investment can help you to earn more on your savings to make big purchases like down payment on a car or home. Stocks and ETF are considered better for long-term achievements such as retirement because they are likely to give better returns with additional risks over time.

Example of reward given to shareholders by publicly traded companies is dividends. Dividends come straight from the company's bottom line. Financial and non-financial bonuses are distributed from the business’s remaining profit after the necessary expenses that are covered.

It’s possible for businesses to hold on to their cash in order to use it for expansion and other strategic purposes.

Investment in dividends is a technique which offers the possibility of profit from two different sources: the regular income and growth in other underlying assets over time.

Investing is an excellent strategy for people who are looking for a passive income stream and those who want to grow wealth through reinvestment of dividend payments.

Investors seeking a low-risk strategy can find this approach appealing to them. Dividend paying stocks are among the most secure investments.

However, be aware that dividend stocks carry danger if you are confused about what you are looking for.

Although dividend stocks can continue their payouts in every economic environment, a diversified income can provide a reliable source of income.

Therefore, a dividend is a sum of money given back to shareholders by a corporation as a kind of compensation and appreciation.

To put it simply, a dividend can be a payment made by corporation to its shareholders out of it’s profits.

The dividend payout is set annually by the company board of directors. However, dividend stocks should be used as primary metric to evaluate stocks.

Divide the dividend per share to pay out annually by current share price to get dividend yield.

Market tightens its hold on many stocks, companies who pay consistent income and portfolio protection can easily draw investors.

Stocks which have higher dividend yield have better survival rates in weak markets, according to historical statistics. Low interest rates strengthen the attraction that are offered by banks on fixed deposits

The maximum fixed deposit rate of SBI is only 5.5%. Companies who can distribute dividends on a consistent basis are known as dividend stocks.

Benefits of investing in stocks with a High Dividend Yield Shareholders can find relief in dividend income during periods of range in market crash environments. Aged investors can receive steady stream of income through dividends. Investors can establish passive income stream with the buy of high yield dividend stocks.

Businesses distribute equal dividend to portion of earnings to shareholders share messages to maintain their cash flow levels. Time is another perk of investing in dividend stocks

When you compare dividends paid today to next year, you’ll notice today's dividend is more valuable by one rupee. Dividend yield is determined using most recent profit and loss statement to determine total dividend paid.

Conclusion

Investors can go for high yield dividend stocks if they have slightly less risk profile from stock market. However, companies pay high yield have peaked growth and possibility to expand more growth is very limited. Consequently, investors who invest in high yield stocks but eye on rapidly growing stocks doesn’t make sense. Because businesses in growth phase will reinvest profits to expand further instead of dividends. Investors must carry their own investment risk profile and investment objectives, before selecting high yield dividend stocks.