2 Tata Stocks To Trade Ex-dividend July 28 For 100-105% Dividend Payout; Do You Own Any?

Two Tata Group-backed stocks will be in focus in the trading week from July 24th to 28th as they will turn ex-dividend. These two stocks are Tata Motors and Tata Motors DVR for their dividend payout in the range of 100% to 105% respectively. The stocks will turn ex-dividend on July 28, followed by the payment in August month.

As per the regulatory filing, Tata Motors has declared a dividend of Rs 2 per Ordinary Share of Rs 2 each (@100%) and ₹2.10 per 'A' Ordinary Share of Rs 2 each (@105%) for the financial year ended March 31, 2023.

The Rs 2.10 per share dividend will be paid to shareholders of Tata Motors DVR.

The two stocks will turn ex-dividend on July 28 which is also the record date to determine eligible shareholders for the dividend payout.

The dividend, if declared at the AGM, shall be paid to the eligible shareholders from August 14, 2023, onwards. Tata Motors annual general meeting will be held on August 8, 2023.

Among key investors, late market mogul Rakesh Jhunjhunwala's wife Rekha will receive dividend benefits as she holds Tata Motors shares.

Tata Motors is the second most valued holding in Rekha's portfolio. As of June 30, 2023, Rekha holds 52,256,000 equity shares or 1.6% in Tata Motors. Her holding is valued nearly Rs 3,270 crore as of now.

On Friday, Tata Motors share price closed at Rs 625.80 apiece up by 0.7% on BSE, while Tata Motors DVR ended at Rs 351.05 apiece higher by 1.4%.

The reason why shareholders in DVR will receive higher dividends than ordinary shares held in Tata Motors as they are distinct from each other.

As per Motilal Oswal's website, Differential Voting Rights (DVR) shares are shares that are permitted to be issued with differential voting and differential dividend rights. DVR shares are different from ordinary shares in two distinct ways. Firstly, they offer lower voting rights compared to ordinary shares. These DVR shares are therefore very useful for companies that want to raise money in the market without diluting effective control of the company.

Thereby, to compensate shareholders for their lower voting rights, these DVR shares pay dividends at a premium than compared to ordinary shares.

Tata Motors launched the first DVR shares in 2008 which was followed by other companies like Future Enterprises, Jain Irrigation and GACM Technologies.