Higher Dividend Yield Stocks in Weak Market

by khalid on 10/03/2011 · 0 comments

ICICI Securities has come out with a report on Expected Higher Dividend Yield Stocks. Dividend-paying companies have well-established cash flows and tend to be more stable, safer, and less volatile.

High dividend yield stocks offer a safe haven to investors where safety has greater priority compared to high returns. Hence, even if the market remains volatile, going ahead, an investor can still get a decent return on investment, thanks to good dividend yielding stocks. The dividends are paid no matter what direction the stocks move and can provide a higher yield on investment in a weak market.

We have short-listed companies that would provide a decent dividend yield in the near future. For this purpose, we have filtered companies that have had at least 75% of FY10 profits in the nine months ended December 2010 and assumed that the companies would maintain their FY10 dividend payout ratio. We have forecasted the FY11E PAT by taking the actual PAT of nine months ended December 2010 and assumed Q4FY11 as an average of last three quarters net profit. Based on the FY11E net profit and FY10 payout ratio, we have calculated the dividend percent for FY11E. Finally, we have deducted the interim dividends already paid in FY11 to arrive at the expected final dividend and dividend yield.

Company NameCMP RsExpected
Dividend
Yield %
Shipping Corporation of India106.06.63
G N F C99.84.88
J & K Bank752.63.76
Nag. Fert & Chem27.23.47
TVS Motor Co55.02.63
Bank of India460.32.41
Vardhman Textile258.12.20

For having a look on entire list by ICICI Securities click here.

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