580% Payout: Consumer Discretionary Stock Okays Rs 58/Share Dividend; Buy?

KDDL is a consumer discretionary small-cap firm having a market capitalization of Rs 3,651 Cr. One of the top manufacturers of progressive tools for various engineering uses, high-quality precision stamped components, and watch components in India is KDDL. Through Ethos Limited, a subsidiary of KDDL, the company also controls the largest luxury watch retail network in India. The Board of Directors has declared a huge dividend of Rs 58 per share, which has put the company under the focus of the market watchers.

KDDL Dividend

"Please be informed that the Board of Directors of KDDL Limited ("the Company") at its meeting held on Thursday, 18th January, 2024 has, inter alia, considered and declared Interim Dividend of Rs. 58 per equity share (i.e. 580%) of Rs. 10/- each, for the financial year 2023-24. The Interim Dividend will be paid within 30 days from the date of declaration in terms of the relevant provisions of the Companies Act, 2013," said the company in a stock exchange filing.

KDDL has fixed Friday, January 26, 2024, as the record date for the purpose of the above-mentioned dividend.

KDDL Financials

Consolidated net sales for KDDL jumped by more than 30% to Rs 339.70 crore during the September quarter of 2023 from Rs 260 crore in the year-ago quarter. In the September quarter, the net profit for the quarter climbed to Rs 25.43 crore, up 1,742.75% from Rs 1.38 crore in Q2FY23. In the September 2023 quarter, the company's EBITDA was Rs 27.18 crore, a 30.61% fall. The company is yet to declare its Q3FY24 results.

KDDL Share Price Target

Deven Mehata - Equity Research Analyst at Choice Broking said KDDL has demonstrated remarkable strength and positive momentum in recent high-volume trading sessions, currently trading at 2876. The stock's recent consolidation within the 2700-2850 range has laid the foundation for a potential upward movement, emphasized by a rising wedge pattern on the weekly charts.

Notably, KDDL maintains a robust technical posture by comfortably holding its position above the crucial 20-day, 50-day, and 200-day Exponential Moving Averages (EMA), reflecting a solid base and signalling a positive trend. The Relative Strength Index (RSI), a pivotal momentum indicator, is on the rise and currently stands at 60 levels.

As KDDL gears up to confront the next resistance level at 3050, its ability to sustain itself above critical support levels during pullbacks suggests a strong technical setup. Employing trailing stop losses, with a protective buffer near the significant support level of 2700, is a prudent risk management strategy for investors who entered the market at lower levels. In conclusion, the technical analysis paints a favourable picture for KDDL, indicating the potential for further upward movement and instilling confidence among investors.

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.