Rs 8/Share Dividend: Smallcap Pharma Stock To Trade Ex-Dividend Ahead Of 80% Dividend Payout

Biotech firm, Hester Biosciences share price will be in focus on Wednesday as they will trade ex-dividend for up to 80% dividend payout for the financial year 2022-23. This pharma company holds a consistent track record for paying high dividends to its shareholders from its profits. The ex-dividend date is the day when the price of the equity share of the listed company gets adjusted for the dividend payout. Hester currently trades over Rs 1,700 levels on exchanges.

The biotech firm has recommended a dividend of ₹ 8 per equity share (80%) on 8,506,865 equity shares of ₹ 10 each fully paid-up for the financial year 2022-23, amounting to ₹ 68.05 million. Notably, the Dividend Pay-out Ratio for the current year is 21% of standalone profits.

Further, the company stated that the Register of Members and Share Transfer Book of the Company shall remain closed from Thursday, 14 September 2023 to Wednesday, 20 September 2023 (both days inclusive) for the purpose of Annual General Meeting and payment of Dividend.

Accordingly, the stock will turn ex-dividend on September 13 ahead of the book closure.

Ahead of the ex-dividend, Hester's share price closed at Rs 1730.85 apiece, down by 1.3% on BSE. The smallcap stock has a market value of Rs 1,472.41 crore as of September 12, 2023.

Hester shares are currently higher by 22% from its 52-week low of Rs 1,415.95 apiece. However, year-to-date, the stock is down marginally by 4% on BSE.

The dividend, if declared by the members at the ensuing Annual General Meeting ("AGM"), will be paid to those shareholders, whose names are registered in the Register of Members on cut-off date. The company plans to pay the dividend on or after September 25, 2023.

As per Trendlyne data, Hester has declared about 24 dividends since June 2005. In the financial years FY22 and FY21, the company paid a dividend of Rs 10 per share each to its shareholders.

Dividends are distributed also in a certain proportion by listed companies from their net profits earned in a respective financial year. The record date is proposed by the listed company's board of directors to determine the name of the eligible shareholders for dividends. As per BSE FAQs, to be eligible to receive dividends, investors have to have shares in the Demat account by record date.

In the annual report of FY23, Rajiv Gandhi CEO & MD said, "Looking ahead, our unwavering dedication to advancing animal health remains steadfast. As we forge ahead, our compass
remains pointed towards innovative research, developing high quality products, and the continuous expansion of our global outreach."

In the June 2023 quarter, the company earned standalone revenue from operations at Rs 80.35 crore versus Rs 50.53 crore in Q1FY23. Overall gross profit margin of Q1FY24 reduced by 7% to Rs 57% due to the change in product mix. Health products and other pharmaceutical products contributed 56% of total sales in Q1 FY24, as compared to 34% in Q1 FY23. Health products have a lower margin. EBITDA for Q1FY24 has improved by 24% to Rs 11.36 crore over Q1FY23 due to healthy growth in overall sales. PAT excluding OCI stood at Rs 6.47 crore in Q1FY24 versus Rs 5.00 crore in Q1FY23, up by 29% YoY.

FY23 revenue stood at Rs 254 crore, while PAT was at Rs 32.34 crore in the fiscal.

Hester Biosciences Limited is one of India's leading animal health companies, manufacturing vaccines and health products since 1997. Hester has three divisions - 1) Poultry Healthcare division; 2) Animal Healthcare division; and 3) Petcare division.

The company is also the world's largest manufacturer and supplier of PPR vaccine, having approximately 75% of the world market.