Spotlight on dividend paying stocks

Investors should analyse the dividend yield and the dividend payout history of a company. There are good reasons for this. In general, if any company is paying dividend then it’s a proxy of the good financial health of the company; it is one way of getting a return without actually exiting the position in the company — it is more of a way of earning fixed income; in general, regular dividend payouts will keep the interest of investors up, therefore more investors would stay interested in the company

The Coal India
        STORY

The Maharatna company, which figures among the highest dividend payers, approved payment of interim dividend for FY17-18 at Rs 16.50 per share of the face value of

Rs 10 after recommendation by the audit committee of the company in its meeting
Shares of Coal India declined 3 per cent intraday Monday as brokerages maintained sell to underweight rating on the stock. The company approved payment of interim dividend for the financial year 2017-18 at Rs 16.50 per share of the face value of Rs 10 as recommended by the audit committee of the company in its meeting.

The company has fixed March 19, 2018 as revised record date for the purpose of payment of interim dividend on equity shares for the financial year 2017-18. The date of payment of interim dividend is on and from March 23, 2018.

Brokerage: Goldman Sachs | Rating: Sell | Target: Rs 270

Goldman Sachs has maintained sell rating on the stock with a target of Rs 270 per share. According to Goldman Sachs company’s payout can sustain over next 3 years, while high dividend payout to limit capex growth.

Brokerage: Morgan Stanley | Rating: Underweight | Target: Rs 221

Brokerage house Morgan Stanley has kept underweight rating on the stock with a target of Rs 221. The firm believes that the dividend is marginally higher than estimate of Rs 14 per share.

Brokerage: Nomura | Rating: Neutral

Broking firm Nomura has maintained neutral rating on stock as stock trades at 6.2x FY19F adjusted EV/EBITDA. It feels that FY18 dividend of Rs 16.50 per share is broadly in line with consensus. The total cash outgo due to dividend will be Rs 12,320 crore and Rs 16.5 per share dividend works to at 5.4 per cent yield, it added. The government share of dividend payout will be Rs 10,120 crore. It has maintained its earnings estimates for the stock and nominal final dividend cannot be ruled out this year. At 11:54 am Coal India was quoting at Rs 297.60, down Rs 7.10, or 2.33 per cent on the BSE.