42% Dividend Yield: Top 5 Largecap Stocks Reward High Dividends In 2023; Vedanta, Coal India, IDFC In List

The year 2023 is less than a month away from ending. And this year was flooded with a huge pile of stocks rewarding their shareholders with hefty dividends. Not just that the dividend opportunities index has also outperformed the benchmark Nifty 50 by a huge gap, indicating that investors have also shown massive appetite for such stocks.

Nifty Dividend Opportunities Index 50 has skyrocketed by over 26% in 12 months, compared to over 8% upside recorded by Nifty 50. The dividend index also touched a new all-time high of 4,971.40 as of December 1, 2023.

The Nifty Dividend Opportunities 50 Index is designed to provide exposure to high-yielding companies. The methodology employs yield-driven selection criteria that aim to maximize yield while providing stability and traceability.

Why invest in dividend-paying stocks?

As per Motilal Oswal's website, a dividend stock is the stock of a firm that pays out large dividends from its profits regularly to its owners. If big, profitable corporations, in particular, anticipate that their stock prices will remain static, they may consider declaring huge dividends to appease present shareholders while also attracting future investors, and increasing the stock price. Some corporations pay dividends in the form of total dividends and interim dividends more than once each year.

Further, the brokerage added, as a result, if a firm that consistently pays significant dividends has an imminent dividend release, you should acquire it since you will get the dividend (by simply investing the share price at the point of purchase) and will most likely profit from capital appreciation within the near future. Lastly, a company's ability to declare dividends is a positive indicator that it is financially solid and expanding.

In past 12 months, here is a list of five large-cap stocks that have paid hefty dividends and also have high dividend yields:

Vedanta Dividends:

Anil Agarwal-backed Vedanta has paid the first interim dividend of up to 1850% aggregating to Rs 18.50 per share for FY24. In the previous fiscal, the metal company paid a behemoth dividend of about 10,150% amounting to Rs 101.5 per share.

This makes Vedanta the top-paying large-cap dividend stock in 2023.

Currently, it has a dividend yield of 42.4%. Last week, on Friday, Vedanta shares settled at Rs 239.30 apiece, up by 2.55% on BSE with a market cap of Rs 88,952.52 crore.

However, Vedanta's shares have seen a significant correction in 2023. YTD, the stock is down by 24.30% on BSE.

Vedanta, a subsidiary of Vedanta Resources Limited, is one of the world's leading natural resources companies spanning across India, South Africa, Namibia, Liberia, UAE, Korea, Taiwan and Japan with significant operations in Oil and gas, Zinc, Lead, Silver, Copper, Iron Ore, Steel, Nickel, Aluminium, Power & Glass Substrate and foraying into semiconductors and display glass.

Hindustan Zinc Dividends:

Yet another metal stock in the top of the list for paying high dividends. Also a large cap! On Sunday, Hindustan Zinc declared that the company's board will meet on December 6th to consider the second interim dividend for FY24, and it fixed December 14 as the record date.

Earlier, for FY24, the company paid a first interim dividend of Rs 7 per share or 350%. In FY23, the company paid a massive 3,775% dividend aggregating to Rs 75.5 per share.

Currently, the stock has a dividend yield of 25.15%. On BSE, the stock broadly ended flat but in green at Rs 300.55 apiece on December 1st with m-cap of Rs 1,26,991.96 crore. Just like Vedanta, Hindustan Zinc as well faced steep correction in the current year so far with a drop of over 7.5% on BSE.

Hindustan Zinc, a Vedanta Group company in the Zinc-Lead and Silver business is the world's 2nd largest integrated Zinc producer and 5th largest Silver producer. The company governs about ~75% of the growing Zinc market in India with its headquarters at Udaipur along with Zinc-Lead mines and smelting complexes spread across the state of Rajasthan.

IDFC Dividends:

IDFC, a holding company, has paid a special dividend of Rs 11 per share in FY23. In percentage terms, the payout was 110%.

Following this, IDFC has a dividend yield of 9.24%, taking it to the third spot of high dividend-yield stocks. On BSE, IDFC shares gained by nearly a per cent to end at Rs 119 apiece on December 1st with m-cap of Rs 19,039.81 crore. The stock is nearing its 52-week high of Rs 133.75 apiece.

YTD, IDFC shares have rallied by nearly 41% on BSE.

IDFC is a development finance institution based in India under the Department of Financial Services, Government of India. It provides finance and advisory services for infrastructure projects, as well as asset management and investment banking.

Coal India Dividends:

The largest govt-backed coal producer in the world, Coal India has recently turned ex-dividend on November 21st for an interim dividend of Rs 15.25 per share for FY24. In percentage terms, the first interim dividend is 152.5%.

In FY23, Coal India paid a massive dividend of 242.50% amounting to Rs 24.25 per share to its shareholders.

At present, Coal India has a dividend yield of 7%. On BSE, the stock price ended at Rs 346.55 apiece, up by 1.3% on December 1st with an m-cap of Rs 2,13,569.35 crore. The stock is currently near its 52-week high of Rs 359.80 apiece.

YTD, Coal India shares have zoomed by over 54%.

Coal India is an Indian central public sector undertaking under the ownership of the Ministry of Coal, Government of India. It is headquartered in Kolkata. It is the largest government-owned-coal-producer in the world. It is also the ninth largest employer in India with nearly 272,000 employees.

Oil India Dividends:

Govt-backed oil and gas explorer, Oil India also recently turned ex-dividend on November 22 for an interim dividend of Rs 3.5 per share or 35% for FY24. In FY23, the company paid a total dividend of 200% amounting to Rs 20 per share. These were announced and paid in the current year.

Oil India currently has a dividend yield of 6.45%. Last week, on Friday, the stock ended at Rs 309.80 apiece, up by 1.44% on BSE with a market cap of Rs 33,594.87 crore. The stock was also near its 52-week high levels of Rs 339.45 apiece. YTD, the stock has risen by at least 44.5% on the exchange.

Oil India is a fully integrated Exploration and production company in the upstream sector, with its origin dating back to the glorious year (1889) of oil discovery in India.

Disclaimer: The recommendations made above are by market analysts and are not advised by either the author nor Greynium Information Technologies. The author, nor the brokerage firm nor Greynium would be liable for any losses caused as a result of decisions based on this write-up. Goodreturns.in advises users to consult with certified experts before making any investment decision.