INSUBCONTINENT EXCLUSIVE:
ET Intelligence Group: Shares of Vedanta are trading at an estimated dividend yield of almost 10 per cent
Going by historical record, investors can expect the dividend in less than six months
According to Bloomberg, Vedanta is expected to give a dividend of Rs 13.84 per share in FY20
It gave dividend of Rs 19.45, Rs 21.2 and Rs 18.85 in FY17, FY18 and FY19, respectively.
The company has been giving heavy dividends over
India-listed Vedanta remains the key source of income for the parent company to meet its debt obligations.
Moreover, the dividend ex-dates
in FY17 and FY18 were in the months of March and April
For FY19, the dividend ex-date was in November
If this remains unchanged, it could mean Vedanta investors make more than 10 per cent on dividends for the coming two years
For instance, dividend per share for FY21is Rs 15.1.
Despite weak set of numbers and guidance cuts, the Vedanta stock has remained fairly
September quarter, the company posted an EBIDTA of Rs 4,420 crore, down 15 per cent on year-on-year
Consolidated net profit rose by 44 per cent to Rs 2,730 crore as it benefited from one-time deferred taxes of Rs 1,891 crore
Vedanta sales fell marginally by 3 per cent to Rs 21,739 crore.
Following a weak first half, the management lowered the production guidance
across segments and increased the cost guidance
profitability in key verticals, having already seen a recovery in the commodity cycle, with prices rising across the commodity basket in the
Gross debt shrunk by Rs 11,000 crore and net debt by Rs 7,000 crore in the past one quarter
Net debt to EBIDTA is now 0.9.
Vedanta stock is now trading at 4 times EV/EBIDTA and less than one time price to book, near a 3-year low
With such valuations, strong balance sheet and a dividend yield of near 10 per cent, the stock offers a good risk to reward ratio for the
