On Tuesday, dividends will no longer be paid out on shares of Vedanta Ltd. The Anil Agarwal company said it would pay an interim payment of Rs 18.50 per share for FY24, which adds up to Rs 6,877 crore. Tuesday is also the record date for the dividend, and Vedanta’s board of directors will decide who can get the payout. Any shareholder whose name appears on the record date list at the close of business will be entitled to the dividend. On June 21, the bonus will be paid.
According to statistics from AceEquity, Vedanta paid a dividend of Rs 45 per share in FY22. This added up to Rs 16,689 crore. The company has declared a dividend payout of Rs 3,519 crore ($9.50 per share) for FY21 and a dividend payout of Rs 1,444 crore ($3.90 per share) for FY20. AceEquity says that the business has paid regular dividends since at least 1994. Between FY17 and FY19, the company said it would pay out payments worth Rs 7,000–8,000 crore.
Analysts think that the dividend for FY24 will be between Rs 45 and Rs 80 per share. They base this on the debt responsibilities of parent company Vedanta Resources. In the March quarter, the business declared a dividend of Rs 33 per share and a total payout of Rs 101.50 for FY23, equivalent to Rs 37,730 crore.
Motilal Oswal Securities said in a recent note that Vedanta did not say anything about dividends for FY24. It said that the company’s net debt was Rs 44,500 crore, which was up 115% from the previous year due to bonus payouts and higher capital expenditures. The stock of Vedanta is aimed at Rs 280 by this firm.
According to Systematix Institutional Equities, Vedanta’s dividend payout in FY23 helped reduce debt at parent company Vedanta Resources, and the dividend is expected to remain elevated at Rs 60-80 per share over FY24 and FY25 due to a sharp reduction in energy costs, especially for coal, implying a yield of 22-29 per cent providing strong downside support.
Nuvama Institutional Equities said that Vedanta might keep giving out big dividends in FY24E and FY25E. For FY24E and FY25E, this firm has figured in dividends of Rs 45 per share. Vedanta is waiting for lenders’ final approval to move Rs 12,590 crore from its general reserve to its reserved earnings. This will help it pay dividends, the company said.
Kotak Institutional Equities, on the other hand, said that bigger dividends can not last. It said that high dividends (Rs 101.50 per share) paid out in FY2023 and an expected increase in standalone net debt/Ebitda to 4.2 times in FY2023 led to a rise in net debt.