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Highest Dividend Paying Stocks in January 2025: IOCL, Coal India, BPCL and More Based on Dividend Yield

Updated on: Dec 29, 2024, 9:22 AM IST
Discover India's highest dividend-paying stocks in January 2025, ranked by dividend yield. Learn their key metrics, advantages, and factors to consider before investing.
Highest Dividend Paying Stocks in January 2025: IOCL, Coal India, BPCL and More Based on Dividend Yield
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Many investors prefer to invest in stocks that pay high dividends because they provide extra income. Investors can opt for these stocks for regular dividend payments. Additionally, investing in India’s top dividend-paying stocks can offer a steady income and indicate that the company is financially stable. In this blog, we will explore the highest dividend-paying stocks in January 2025, ranked by their dividend yield.

Highest Dividend Paying Stocks in January 2025 – Based on Dividend Yield

Name Market Cap Dividend Yield 1Y Return 5Y CAGR
Chennai Petroleum Corporation Ltd 8,867.92 9.24 -12.74 39.68
Indian Oil Corporation Ltd 1,95,440.22 8.46 7.98 10.23
Bharat Petroleum Corporation Ltd 1,26,804.95 7.08 29.32 4.1
Coal India Ltd 2,37,182.46 6.63 5.04 14.09
Vedanta Ltd 1,80,576.68 6.08 76.58 25.56
Oil and Natural Gas Corporation Ltd 3,00,891.91 5.12 15.24 13.65
Hindustan Petroleum Corp Ltd 87,930.77 5.09 61.21 18.73
Great Eastern Shipping Company Ltd 13,855.17 4.51 -2.71 26.42
Gujarat Pipavav Port Ltd 8,709.72 4.05 21.04 16.13
UTI Asset Management Company Ltd 15,735.85 3.8 44.94

Note: The above stocks have been selected from the Nifty 500 universe and sorted based on high dividend yield stocks as of December 26, 2024.

Overview of 5 Highest Dividend Paying Stocks

1. Chennai Petroleum Corporation Limited

Chennai Petroleum Corporation Limited specialises in refining crude oil to produce and supply various petroleum products. It is also involved in manufacturing and selling lubricating oil additives.

The company reported a revenue of ₹14,424.86 crore in Q2 FY24, compared to ₹20,361.17 crore in Q1 FY24, reflecting a sequential decline. The company’s net profit turned negative in Q2 FY24, recording a loss of ₹629.49 crore, as opposed to a profit of ₹342.60 crore in the previous quarter. 

Key Metrics:

  • EPS  (Earning per Share): 46.03
  • ROE  (Return on Equity): 9.16

2. Indian Oil Corporation Ltd (IOCL)

Indian Oil Corporation Ltd (IOCL), a Maharatna company under the Government of India, operates across the entire hydrocarbon value chain. Its activities include refining, pipeline transportation, marketing petroleum products, research and development, exploration and production, and marketing natural gas and petrochemicals. 

For the quarter ending September 2024, Indian Oil Corporation Ltd (IOCL) reported revenue of ₹1,95,148.94 crore, compared to ₹2,15,988.76 crore in the previous quarter (June 2024). The net profit for September 2024 stood at ₹180.01 crore, a significant drop from ₹2,643.18 crore recorded in June 2024. 

Key Metrics:

  • EPS: 11.14
  • ROE: 9.02

3. Bharat Petroleum Corporation

Bharat Petroleum Corporation is a government-owned company involved in refining crude oil and selling petroleum products.

In the quarter ending September 2024, the company recorded revenue of ₹1,17,951.69 crore, compared to ₹1,28,103.36 crore in the previous quarter. Net profit for the September quarter stood at ₹2,397.23 crore, down from ₹3,014.77 crore in the June quarter. The company’s cumulative net profit for the fiscal year reached ₹26,673.50 crore.

Key Metrics:

  • EPS: 30.04
  • ROE: 17.09

4. Coal India Ltd

Coal India Ltd focuses on mining and producing coal, along with operating coal washeries. Its main customers are the power and steel industries, with additional consumers including cement, fertilisers, and brick kilns.

In the financial results for Coal India Ltd, the revenue for Q2 FY24 stood at ₹315.02 crore, compared to ₹389.71 crore in Q1 FY24, and totalled ₹1,516.38 crore for the fiscal year so far. The company reported a significant net profit of ₹4,133.97 crore in Q2 FY24, a notable increase from ₹87.46 crore in the previous quarter, contributing to a cumulative net profit of ₹15,766.83 crore for FY23-24.

Key Metrics:

  • EPS: 27.38
  • ROE: 91.47

5. Vedanta Ltd

Vedanta Ltd is a large natural resource company involved in finding, extracting, and processing minerals and oil & gas. The company explores, produces, and sells products like zinc, lead, silver, copper, aluminum, iron ore, and oil & gas. It operates in countries such as India, South Africa, Namibia, Ireland, Liberia, and the UAE.

In the financial results for Vedanta Ltd, the company reported a revenue of ₹18,288 crore for September 2024, up from ₹16,715 crore in June 2024. For the FY 2023-24, the revenue stood at ₹70,757 crore. The net profit for September 2024 was ₹10,553 crore, significantly higher than the ₹4,183 crore in June 2024. However, the net profit for FY23-24 was ₹6,623 crore, showing a decrease compared to the quarterly figures.

Key Metrics:

  • EPS: 45.85
  • ROE: 23.80

What is a Dividend?

A dividend is a payment made by a company to its shareholders as a reward. This payment can be in the form of cash or other assets. The company’s board of directors decides on the dividend amount, but it needs to be approved by the shareholders. While paying dividends is not mandatory, they are usually given from the company’s profits.

What Are High Dividend Paying Stocks?

To understand the best dividend stocks in India, it’s important to know about the dividend yield, which is the income an investor earns relative to the current stock price. It’s calculated using the formula:

Dividend Yield = (Annual Dividend / Share Price) x 100

Investors look for high dividend-paying stocks, which offer higher yields than the average. These stocks provide a reliable income stream, which investors may reinvest for better returns or use for long-term goals like retirement. When choosing high dividend-paying stocks, it’s important to consider their ability to maintain or grow dividend payments, ensuring a consistent income and share price appreciation.

Advantages of Dividend Paying Stocks in India

  • Reliable Income: Many dividend-paying stocks, especially the top ones, offer a steady source of income, making them ideal for investors seeking regular returns, such as retirees.
  • Potential for Capital Appreciation: Companies that pay dividends are often financially strong and established. This can lead to long-term growth in stock value, making dividend-paying stocks a solid investment for the future.
  • Protection Against Inflation: Dividends provide a steady income that can keep up with rising prices, helping investors maintain their purchasing power in times of inflation.
  • Stability: Dividend-paying companies tend to be more stable than those that don’t pay dividends, as they have strong cash flows. Investing in these companies helps reduce the risk of large fluctuations in stock prices.

Factors to Consider Before Investing in High-Dividend Paying Stocks

  • Payout or Yield Ratio
    A high ratio means fewer profits are reinvested into the company. Check whether high dividends are taking too much from the company’s earnings.
  • Don’t Rely Only on Ratios
    A high dividend ratio doesn’t guarantee future success. Always consider other factors like company performance and market conditions.
  • Complete Company Evaluation
    When evaluating stocks with high dividends, look beyond just the dividends. Consider other financial metrics such as earnings, outstanding shares, and shareholder history.

Conclusion

Investing in dividend-paying stocks can be a smart way to grow wealth over the long term. These stocks offer consistent income while also having the potential for price growth. However, it’s important to thoroughly research and align your investment choices with your financial objectives before making any decisions.

 

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.

 

Investments in securities market are subject to market risks, read all the related documents carefully before investing.

 

Published on: Dec 29, 2024, 9:22 AM IST

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