Stock Analysis

Top 3 Indian Dividend Stocks To Enhance Your Portfolio

NSEI:REDINGTON
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The Indian market has gained 1.8%, and in the last year, it has climbed 41% with earnings forecasted to grow by 17% annually. In such a robust environment, selecting dividend stocks that offer consistent returns can be a strategic way to enhance your portfolio.

Top 10 Dividend Stocks In India

NameDividend YieldDividend Rating
Castrol India (BSE:500870)3.14%★★★★★★
Balmer Lawrie Investments (BSE:532485)3.83%★★★★★★
D. B (NSEI:DBCORP)5.04%★★★★★☆
Indian Oil (NSEI:IOC)8.21%★★★★★☆
Bharat Petroleum (NSEI:BPCL)6.21%★★★★★☆
Redington (NSEI:REDINGTON)3.21%★★★★★☆
VST Industries (BSE:509966)3.08%★★★★★☆
Canara Bank (NSEI:CANBK)3.05%★★★★★☆
PTC India (NSEI:PTC)3.25%★★★★★☆
Bank of Baroda (NSEI:BANKBARODA)3.17%★★★★★☆

Click here to see the full list of 17 stocks from our Top Indian Dividend Stocks screener.

Let's review some notable picks from our screened stocks.

Canara Bank (NSEI:CANBK)

Simply Wall St Dividend Rating: ★★★★★☆

Overview: Canara Bank offers a range of banking products and services both in India and internationally, with a market cap of ₹957.32 billion.

Operations: Canara Bank's revenue segments include Treasury Operations (₹255.75 billion), Life Insurance Operation (₹120.19 billion), Wholesale Banking Operations (₹430.48 billion), Retail Banking Operations - Digital Banking (₹22.30 million), and Other Retail Banking Operations (₹632.28 billion).

Dividend Yield: 3.1%

Canara Bank's dividend payments have been volatile over the past decade, though they are currently well-covered by earnings with a low payout ratio of 19.1%. The bank's recent $300 million fixed-income offering and executive changes indicate ongoing strategic adjustments. Despite trading at a significant discount to its estimated fair value, the high level of bad loans (4.3%) remains a concern for long-term sustainability.

NSEI:CANBK Dividend History as at Sep 2024
NSEI:CANBK Dividend History as at Sep 2024

PTC India (NSEI:PTC)

Simply Wall St Dividend Rating: ★★★★★☆

Overview: PTC India Limited, with a market cap of ₹71.00 billion, engages in the trading of power across India, Nepal, Bhutan, and Bangladesh.

Operations: PTC India Limited generates revenue primarily from its power trading segment, which accounts for ₹159.67 billion, and its financing business, which contributes ₹7.35 billion.

Dividend Yield: 3.3%

PTC India recently declared a ₹7.80 cash dividend with an ex-div date of August 20, 2024. The company's Q1 2024 earnings showed a net income increase to ₹1.74 billion from ₹1.30 billion the previous year, indicating strong profitability. PTC's dividends are well-covered by both earnings (54% payout ratio) and cash flows (9.4% cash payout ratio), though they have been volatile over the past decade, impacting reliability for consistent dividend investors.

NSEI:PTC Dividend History as at Sep 2024
NSEI:PTC Dividend History as at Sep 2024

Redington (NSEI:REDINGTON)

Simply Wall St Dividend Rating: ★★★★★☆

Overview: Redington Limited offers supply chain solutions both in India and internationally, with a market cap of ₹150.95 billion.

Operations: Redington Limited's revenue segments include IT products, which generated ₹492.20 billion, and mobility products, contributing ₹215.50 billion.

Dividend Yield: 3.2%

Redington's dividend payments are covered by earnings (39.8% payout ratio) and cash flows (50.6% cash payout ratio), but have been volatile over the past decade, affecting their reliability. Despite this, dividends have increased over the past 10 years. The stock trades at 9.6% below its estimated fair value and offers a dividend yield in the top 25% of Indian market payers. Recent Q1 earnings showed slight revenue growth to ₹213 billion with net income at ₹2.46 billion.

NSEI:REDINGTON Dividend History as at Sep 2024
NSEI:REDINGTON Dividend History as at Sep 2024

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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