Vishnusurya Projects and Infra (NSE:VISHNUINFR) Has Announced A Dividend Of ₹1.00

The board of Vishnusurya Projects and Infra Limited (NSE:VISHNUINFR) has announced that it will pay a dividend on the 30th of October, with investors receiving ₹1.00 per share. The dividend yield will be 0.6% based on this payment which is still above the industry average.

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Vishnusurya Projects and Infra's Projected Earnings Seem Likely To Cover Future Distributions

Impressive dividend yields are good, but this doesn't matter much if the payments can't be sustained. Vishnusurya Projects and Infra is quite easily earning enough to cover the dividend, however it is being let down by weak cash flows. In general, we consider cash flow to be more important than earnings, so we would be cautious about relying on the sustainability of this dividend.

Over the next year, EPS could expand by 12.5% if recent trends continue. Assuming the dividend continues along recent trends, we think the payout ratio could be 7.4% by next year, which is in a pretty sustainable range.

Check out our latest analysis for Vishnusurya Projects and Infra

Vishnusurya Projects and Infra's Dividend Has Lacked Consistency

Even in its short history, we have seen the dividend cut. The annual payment during the last 2 years was ₹2.00 in 2023, and the most recent fiscal year payment was ₹1.00. Dividend payments have fallen sharply, down 50% over that time. Declining dividends isn't generally what we look for as they can indicate that the company is running into some challenges.

The Dividend Looks Likely To Grow

Dividends have been going in the wrong direction, so we definitely want to see a different trend in the earnings per share. It's encouraging to see that Vishnusurya Projects and Infra has been growing its earnings per share at 12% a year over the past five years. A low payout ratio and decent growth suggests that the company is reinvesting well, and it also has plenty of room to increase the dividend over time.

Our Thoughts On Vishnusurya Projects and Infra's Dividend

In summary, while it's good to see that the dividend hasn't been cut, we are a bit cautious about Vishnusurya Projects and Infra's payments, as there could be some issues with sustaining them into the future. While Vishnusurya Projects and Infra is earning enough to cover the payments, the cash flows are lacking. We don't think Vishnusurya Projects and Infra is a great stock to add to your portfolio if income is your focus.

Companies possessing a stable dividend policy will likely enjoy greater investor interest than those suffering from a more inconsistent approach. However, there are other things to consider for investors when analysing stock performance. Case in point: We've spotted 4 warning signs for Vishnusurya Projects and Infra (of which 2 can't be ignored!) you should know about. If you are a dividend investor, you might also want to look at our curated list of high yield dividend stocks.

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