Top 5 Penny Stocks With Track Record Of Paying High Dividends For 5-Years In Row; SJVN To Bhansali Engineering

Dividends are among many incentives that listed companies offer to their shareholders from their profits in their respective financials. Not every company listed on stock exchanges needs to pay dividends, as some prefer to retain their profits and invest them into business. But there are many large-caps, small-caps, midcaps and even penny stocks who have a consistent track record of paying hefty dividends. In penny stocks, five stocks are trading below Rs 100 and have held a strong track of dividend paying for five consecutive years.

These penny stocks also have high dividend yield ranging from 2% to 20%. According to ICICI Direct's blog, buying dividend-yield stocks can help investors generate income via dividends. For high dividend yield stocks, the dividend yield also acts as a base below the price of the stock normally does not fall.

Here is the list of five penny stocks with a strong track record of paying dividends and high dividend yields in 5 years.

1. Steel City Securities:

As per Trendlyne data, Steel City paid a total dividend of Rs 2 per share in two interims so far in 2023. The stock's first dividend in 2023 was in February at Re 1 per share, followed by another Re 1 per share in July this year. But, the company has been paying the same amount since 2017.

It has declared up to 19 dividends since March 2017. Currently, it has a dividend yield of 2.96%. The stock is listed on NSE, and its YTD gains are nearly 8%. On December 1st, Steel City's share price stood at Rs 67 apiece.

Steel City was established in 1995 with a strong platform in providing Share share-sharing facilities through VSATs at various locations in Andhra Pradesh as well as neighbouring States.

2. SJVN:

At 2.08% dividend yield, SJVN has paid a total dividend of Rs 1.77 per share in the last 12 months. The company has paid up to 23 dividends since September 1, 2010.

On BSE, SJVN shares stood at Rs 84.98 apiece as of December 1, 2023. The stock is up by 80% from its 52-week low of Rs 30.39 apiece. Year-to-date, SJVN has given a massive 143% return as of now.

The majority of consensus on Trendlyne recommends buying SJVN shares.

SJVN, a Mini Ratna, Category-I and Schedule -'A' CPSE under the administrative control of the Ministry of Power, was incorporated on May 24, 1988, as a joint venture of the Government of India (GOI) and the Government of Himachal Pradesh (GOHP).

SJVN is now a listed Company having a shareholders pattern of 55.00% with Govt. of India, 26.85% with Govt. of Himachal Pradesh and the rest of 18.15% with the Public. SJVN is presently implementing or operating power projects.

SJVN aims to be a 5000 MW company by 2023-24, 25000 MW company by 2030 and 50000 MW company by 2040. Presently, the total project portfolio of SJVN is 58,145 MW, out of which 2091.5 MW is under operation, 4438 MW is under Construction, and 12998 MW is under Pre-construction and S&I stage. Capacity of 2507 MW identified by MoP, GoI in Arunachal Pradesh, Pumped Storage projects (PSPs) of 13190 MW capacity, Thermal Project of 1920 MW capacity and Renewable Projects of 21000 MW capacity are under allotment.

3. Bhansali Engineering:

This small-cap stock in speciality chemicals has delivered 25 dividends since July 2003. In the latest 12 months, the company paid dividends to the tune of Rs 17 per share. Bhansali is among the dividend kings in penny stocks.

At present, the stock's dividend yield is at 18.32%. On BSE, the stock price stood at Rs 92.87 apiece, up by 1.44% on BSE after market hours of December 1st. YTD, the stock has rallied by over 29%.

Bhansali Engineering Polymers has pioneered in manufacturing international quality acrylonitrile butadiene styrene (ABS). BEPL's customer base includes leading companies dealing in Automobiles, Home Appliances, Electronics, Health care and kitchenware. BEPL has been successful in being the lowest-cost producer of ABS in India with quality standards at par' with the Global Best.

4. Gothi Plascon:

Gothi has declared a total of 4 dividends since March 2020, despite the first wave of COVID-19 that brought several businesses to a standstill across the globe. In the last 12 months, the company paid a dividend of Rs 2 per share.

Currently, it has a dividend yield of 6.67%. Meanwhile, its current market price is at Rs 30 apiece on BSE.

The is a prime developer in the state of Pondicherry and has MNCs as its clients. And it continues to keep looking for opportunities in this field to expand its footprint in the state of Pondicherry.

5. Saven Technologies:

This IT stock has paid dividends consistently for the past five consecutive years. But on a broader scale, the company has declared up to 11 dividends since June 2001.

At the latest, Saven paid a dividend of Re 1 per share each. Currently, it has a dividend yield of 2.07%.

On BSE, Saven shares were at Rs 48.41 apiece as of December. YTD, Savan shares gained by nearly 17% on this exchange.

Saven is the fastest-growing service provider to technology-driven businesses. For the past 25 years, Saven's expertise has continued to give clients immediate and measurable results - advantages they can leverage into long-term successes for years to come. More than 60 companies around the world use Saven's services to discover and overcome new and existing IT-related challenges.

Key Factors To Note Before Investing In Dividend-Paying Penny Stocks:

Brokerage ICICI Direct's blog highlighted numerous factors. These are:

- Focus on dividend-paying companies that are not just high in one year but that have consistent dividend payout. That is a more sustainable scenario.

- Be wary of the quality of penny stocks since many of them can be inherently risky. Focus on penny stocks with a track record of consistent growth in sales and profits and stable to growing margins. Look at management quality and bandwidth.

- Dividends are taxed at the peak rates now in the hands of the investor. A 7% dividend yield is just about 4.9% in post-tax terms. In the past, the dividends were tax-free in the hands of the investors.

- There is also a valuation angle to it. Historically, markets assign low valuations to companies that pay high dividends as they are seen to not have growth prospects. What you gain on dividends, you can lose on valuations.

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.