Home Collections Highest Dividend Paying Stocks in India for 2024: Top High-Yield Shares for Consistent Returns

Highest Dividend Paying Stocks in India for 2024: Top High-Yield Shares for Consistent Returns

Highest Dividend Paying Stocks in India for 2024: Top High-Yield Shares for Consistent Returns
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Investors prefer investing in high-dividend yielding stocks as they benefit from additional income from investment in dividend-yielding companies. As a result, in India, many investors prefer top dividend-paying stocks for regular dividend returns. The allure of dividends makes a stock attractive as the potential for earnings from regular dividends and capital appreciation. Moreover, investing in India’s highest dividend-paying stocks can ensure a steady income stream and ensure that the company is doing well financially. 

In this article, we will explore the highest dividend-paying stocks in India, the advantages of investing in these stocks, and key factors to consider before investing in dividend-yielding stocks.

Highest Dividend Paying Stocks in 2024 from Nifty 500

Here are the top 10 highest dividend paying stocks in Nifty 500: 

Stock NameSub-SectorMarket Capitalization (in Cr)Share PriceDividend YieldPE RatioDividend Per Share
Hindustan Petroleum Corp LtdOil & Gas - Refining & Marketing₹74,058₹358.209.064.6231.50
Indian Oil Corporation LtdOil & Gas - Refining & Marketing₹2,39,637₹170.746.905.7412.00
Bharat Petroleum Corporation LtdOil & Gas - Refining & Marketing₹1,33,517₹315.956.704.9721.00
Vedanta LtdMetals- Diversified₹1,70,484₹455.506.4440.2229.50
Coal India LtdMining- Coal₹3,06,749₹512.455.128.2025.50
Chennai Petroleum Corporation LtdOil & Gas - Refining & Marketing₹16,152₹1,212.105.075.8855.00
UTI Asset Management Company LtdAsset Management₹13,666₹1,060.804.3817.8547.00
Oil and Natural Gas Corporation LtdOil & Gas - Exploration & Production₹4,05,714₹322.653.808.2412.25
ICICI Securities LtdInvestment Banking & Brokerage₹24,976₹768.853.7514.7229.00
HCL Technologies LtdIT Services & Consulting₹4,25,046₹1,569.553.3227.0752.00
Disclaimer: Please note that the above list is for educational purposes only, and is not recommendatory. Please do your own research or consult your financial advisor before investing.

Note: The data in the list of top dividend yield stocks in India is from 11th June, 2024. This data is derived from Tickertape Stock Screener.

🚀 Pro Tip: You can use Tickertape’s Mutual Fund Screener to research and evaluate funds with over 50+ pre-loaded filters and parameters.

Overview of the Top Dividend Paying Stocks in India

Let us now look at an overview of the list of top dividend paying companies in India: 

Indian Oil Corporation Ltd

Indian Oil Corporation Limited is engaged in refining. The company’s segments include the Sale of Petroleum Products, the Sale of Petrochemicals, and Other businesses. As of 11th June 2024, this highest dividend paying company’s market capitalisation is ₹2,38,366.50 cr. Over the past five years, the company’s free cash flow growth has been 5.27%, higher than the industry average of -67.93%.

Vedanta Ltd

Vedanta Limited is a global diversified natural resource company operating across copper, aluminium, iron ore, power, zinc, lead, silver, oil, and gas segments. As of 11th June 2024, the company’s market capitalisation is ₹1,70,976.94 cr. Over the past five years, the company’s revenue has grown at a yearly rate of 8.12%, higher than the industry average of 8.09%. 

Hindustan Petroleum Corp Ltd

Hindustan Petroleum Corporation Limited is a holding company. The company is engaged in the business of refining of crude oil and marketing of petroleum products. As of 11th June 2024, the company’s market capitalisation is ₹77,091.01 cr. The company’s dividend yield is 5.80%, PB Ratio 2.39%, and PE Ratio 4.81%.

Chennai Petroleum Corporation Ltd

Chennai Petroleum Corporation Limited (CPCL) is a company that offers high-speed diesel (HSD) and motor spirit (MS). The company operates in the downstream petroleum sector. As of 11 June 2024, its market capitalisation is ₹14,506.95 cr. The company’s ​​revenue has grown yearly at 18.74%, higher than the industry average of 15.87%, over the past five years. The company’s market share increased from 2.38% to 2.68% in the same period.

Coal India Ltd

Coal India Limited (CIL) is a holding company that produces and sells coal. It serves the power and steel sectors and the cement, fertiliser, brick, and kiln industries. As of 11th June 2024, the company’s market capitalisation is ₹3,08,752.69 cr. The company’s dividend yield is 5.09%, PB ratio is 5.32%, and PE ratio is 8.25%.

UTI Asset Management Company Ltd

UTI Asset Management Company Ltd is an India-based portfolio manager. UTI AMC is the holding company for UTI Venture Funds Management Company, which manages venture funds, and UTIInternational Ltd, which markets offshore funds to overseas investors. As of 11th June 2024, the company’s market capitalisation is ₹11,790.54 cr. The company’s dividend yield is 5.06%, PB ratio is 3.05%, and PE ratio is 15.40%. 

Oil and Natural Gas Corporation Ltd

Oil and Natural Gas Corporation Limited is a global energy holding company that explores, develops, and produces crude oil and natural gas. As of 11th June 2024, the company’s market capitalisation is ₹3,56,336.41 cr. The company’s debt-to-equity ratio has been 49.79%, lower than the industry average of 50.21%, over the past five years. The company’s dividend yield is 4.32%, PB ratio is 1.18%, and PE ratio is 7.24%. 

ICICI Securities Ltd

ICICI Securities offers various financial services, including brokerage, financial product distribution and investment banking, and focuses on retail and institutional clients. As of 11th June 2024, the company’s market capitalisation is ₹23,516.12 cr. The company’s revenue has grown at a yearly rate of 12.98%, higher than the industry average of 10.35%, over the past five years. The company’s market share increased from 6.56% to 6.77% in the same period.

HCL Technologies Ltd

HCL Technologies Limited provides various software development, business process outsourcing, and information technology infrastructure services. As of 11 June 2024, the company’s market capitalisation is ₹3,64,278.88 cr. Over the past five years, the company’s revenue has grown yearly at 14.7%, higher than the industry average of 13.37%. The company’s market share increased from 12.72% to 13.9% in the same period.

Great Eastern Shipping Company Ltd

The Great Eastern Shipping Company provides shipping services for the transportation of crude oil, petroleum products, gas, and dry bulk commodities. As of 11th June 2024, the company’s market capitalisation is ₹14,458.03 cr. Over the past five years, the company’s current ratio has been 339.77, higher than the industry average of 289.66. The company’s dividend yield is 3.58%, PB ratio is 1.41% and PE ratio is 5.53%.

How to Invest in the Highest Dividend Paying Stocks via smallcase?

Let’s go through a few steps you can follow to invest in high dividend paying stocks and top dividend yield stocks in India via smallcase:

  1. Log in with any Indian smallcase broker and enter your password on the smallcase app or website.
  1. Explore smallcases like the Dividend smallcases by Windmill Capital or the DiviGrowth Capital smallcase managed by Green Portfolio to find out which suits your needs best. After aligning your investment goals with a particular smallcase, make your choice. 
  2. Review your personal details and the billing plan before placing an order. Next, click on ‘Invest now’. 
  3. Lastly, choose between Monthly SIP or One Time payment method. 
  4. Finally, click on ‘Confirm Orders’. 
  5. Congrats! You have now invested in high dividend stocks in India!

Dividend Aristocrats smallcase by Windmill Capital

Dividend Stars smallcase by Windmill Capital

High Dividend Yield and Capital Appreciation smallcase by Green Portfolio

Dividend – Smart Beta smallcase by Windmill Capital

However, if you’re confused about which stocks to pick, you can explore smallcases:

  1. smallcases are readymade portfolios of stocks/ETFs, that are based on a theme idea or strategy
  2. They’re created and managed by SEBI-registered experts
  3. smallcase.com offers over 200+ stock portfolios, created by 180+ managers
  4. Some of the popular smallcases among new investors are as follows:

Equity & Gold smallcase by Windmill Capital

Top 100 Stocks smallcase by Windmill Capital

All Weather Investing smallcase by Windmill Capital

Disclosures for aforementioned smallcases

  • Disclosure for Dividend Aristocrat smallcase
  • Disclosure for Dividend Stars smallcase
  • Disclosure for DiviGrowth Capital smallcase
  • Disclosure for High Dividend Yield and Capital Appreciation smallcase

What is a Dividend?

A dividend is a reward, either in cash or other forms, bestowed upon shareholders by a company. The company’s board of directors determines dividends, subject to shareholder approval. While not mandatory, dividends are typically a share of the company’s profits distributed to its shareholders.

After settling debts, a company may allocate residual profits for shareholder rewards as dividends. However, in cases of cash shortages or the need for reinvestment, companies pay dividends and may opt not to pay dividends. When declaring dividends, a company establishes a record date; shareholders registered by that date qualify for a dividend payout based on their shareholding. The company usually dispatches dividend checks to shareholders within a week. Stocks are commonly traded with dividends included until two business days before the record date, after which they become ex-dividend.

What are High Dividend Paying Stocks?

Understanding top dividend paying stocks in India involves grasping the concept of ‘dividend yield.’ This term refers to the income investors receive relative to the current stock price. It’s calculated using the formula: 

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

Investors seek out high dividend-paying stocks, those with a higher yield compared to a benchmark. These stocks can provide a reliable income stream, which investors often reinvest to enhance returns or allocate toward long-term goals like retirement.

Investors should evaluate the potential of the best dividend stocks based on their consistent dividend payments and the steady growth in the dividend percentage. This ensures the selection of high dividend Indian stocks that offer both share price appreciation and regular distributions, making them a valuable investment.

Which Sectors Offer the Highest Dividend Paying Indian Stocks?

Our dividend smallcase by Windmill Capital offers you the opportunity to explore a wide array of investment opportunities in the high dividend paying sector. Investors must take their decisions according to their investment objectives and risk appetite, whether they want a basket heavy on large cap stocks or small or mid cap stocks. They can also choose between term dividend streaks (Dividend – Smart Beta)  and long term dividend streaks (Dividend Aristocrats), while making their decision.  Let us now look at a few sectors that generally offer high dividend paying Indian stocks:

  • Financial Sector: The financial sector stands out as one of the most lucrative for investors, with real estate investment trusts (REITs) and related industries contributing to its high average yield. Notably, banks and insurance companies within the sector often offer comparatively lower yields.
  • Utility Sector: Favored by dividend investors, the utility sector encompasses diverse industries, including foreign, electric, gas, and water. Despite modest price growth in the last five years, these highest dividend yield stocks are considered defensive due to their stable revenue, which remains unaffected by economic conditions.
  • Basic Materials Sector: The basic materials sector presents a high overall dividend yield, primarily propelled by the Oil and Gas Drilling & Exploration and Industrial Metals & Mining industries. However, some sub-industries, such as Aluminum, Silver, and Specialty Chemicals, yield less than 2%.
  • Consumer Goods Sector: Led by cigarette and tobacco product industries, the consumer goods sector is renowned for its high yields. Despite the prevalence of low-yield industries, there are still promising investment opportunities within this sector.
  • Services Sector: As the largest sector, services encompass stocks from 60 industries, including gaming and shipping. Notably, the average dividend yield in this sector tends to surpass that of the overall market.
  • Technology Sector: Comprising 32 industries, the technology sector is spearheaded by the domestic telecom industry, known for its high-yield stocks. While the tech industry is not generally associated with attractive dividends, some companies do incorporate dividends into their financial strategies.
  • Healthcare Sector: The healthcare sector offers a varied landscape in terms of dividend yield, with drug manufacturer industries often providing the most favorable returns. Despite this variation, the overall sector’s average yield aligns with the broader market.
  • Industrial Goods Sector: Despite having the lowest average dividend yields, the industrial goods sector still offers opportunities for dividend investors to find stocks with decent payouts. Investors should carefully navigate the unique characteristics of this sector to uncover promising investments.

Why Invest in the Highest Dividend Paying Stocks?

As mentioned above, the highest dividend-paying Indian stocks refer to companies paying dividends and the ones with a high dividend yield relative to the market or their peers. Thus, investing in the highest dividend paying stock in the Indian stock market can be beneficial for several reasons:

  • Reliable income: Dividend paying stocks can be a reliable source of income, which can be particularly attractive for those who are retired or seeking regular income from their investments.
  • Potential for capital appreciation: Companies that pay dividends are often well-established and financially sound, which can lead to the potential for capital appreciation over time.
  • Protection against inflation: Dividends can help hedge against inflation by providing you with a steady income stream that can keep up with rising prices.
  • Stability: Dividend-paying companies are often more stable than non-dividend-paying companies, as they typically have strong cash flows and are less likely to experience drastic swings in stock prices.
  • Reinvestment opportunities: Dividends can be reinvested into the company, which can help compound your returns over time. 

In addition to the above pointers, investors are advised to do thorough research and/or consult their financial advisor before investing in high dividend-paying stocks in India.

Advantages of the Highest Dividend Paying Indian Stocks

Let’s look at why high dividend stocks can be a potentially good investment option.

  • Potential for Higher Total Returns: In addition to dividend income, high dividend stocks also offer the potential for capital appreciation. Historically, high dividend yield stocks have outperformed low or no-dividend stocks, offering higher returns over the long term.
  • Lower Risk: Companies giving dividends that are high tend to be well-established, financially stable companies with consistent earnings. This can make even the best dividend yield stocks less volatile and less risky than other stocks.
  • Inflation Protection: Dividend income can provide a hedge against inflation. Unlike fixed-income investments, such as bonds, dividend payments tend to increase over time, helping to maintain purchasing power in the face of inflation.
  • Tax Advantages: In some cases, the best dividend paying stocks may be taxed at a lower rate than other types of investment income, such as interest income. Thus, you can take a tax advantage from dividends.

However, one must consider their investment goal and risk appetite before investing in these highest dividend paying stocks in India.

What is the Criteria for Selecting High Dividend Paying Stocks?

When selecting the highest dividend paying Indian stocks, here are some criteria that you can consider:

  • Dividend Yield: A high dividend yield is generally considered 4% or higher, but this can vary depending on the industry and market conditions. You should look for stocks with a consistent history of high dividend yields.
  • Dividend Growth: You may also want to consider the growth rate of the company’s dividend payments. A company that consistently increases its dividend payout over time is usually a sign of financial strength and stability.
  • Earnings and Cash Flow: It’s important to analyse the company’s earnings and cash flow to ensure it can sustain its dividend payouts. Looking for companies with stable earnings and cash flow growth is advisable.
  • Payout Ratio: The payout ratio is the percentage of earnings a company pays out as dividends. A high payout ratio may indicate that the company is paying out more in dividends than it can afford, which could lead to a dividend cut.
  • Industry and Market Conditions: Certain industries, such as utilities and consumer staples, are known for paying high dividends. You may also want to consider market conditions, such as interest rates and inflation, as these can impact the performance of the highest dividend paying stocks.
  • Company Financials: It’s important to analyze the company’s financial statements, such as its balance sheet and income statement, to ensure it has a strong financial position. You must check the company’s debt and credit ratings.

However, investors must do their own research and/or consult their financial advisor before investing.

What are the Strategies for Investing in High Dividend Paying Stocks?

Here are some strategies for investing in the highest dividend paying Indian stocks:

  • Focus on Quality: Look for the highest dividend paying companies in India with strong financials, stable earnings, and a consistent history of paying dividends. Companies with a competitive advantage, such as a strong brand or intellectual property, are also good choices.
  • Diversify: Since diversification is key, you should consider investing in multiple high dividend stocks across different sectors and industries to mitigate the risk.
  • Look for Dividend Growth: Companies that consistently increase their dividends over time and offer capital appreciation.
  • Consider Total Return: While dividend income is an important factor, you should also consider a stock’s total return potential, including the potential for capital appreciation.
  • Keep an Eye on Industry and Market Conditions: You should consider industry and market conditions, such as interest rates and inflation, which can impact the performance of the highest dividend-paying stocks. 

As always, investors must research and/or consult their financial advisor before investing in high dividend stocks.

Risks Associated with High Dividend Stocks

Although the highest dividend-paying Indian stocks can be attractive, it is important to learn more about the risks associated with them.

Fool’s Gold Dilemma

  • High dividends might be alluring, but investors must scrutinize the reasons behind the elevated dividend yield.
  • A notably high dividend yield could indicate financial distress within the company, with share prices falling due to underlying financial challenges.
  • This attractiveness may be short-lived, as companies under financial stress might reduce or eliminate dividends to preserve cash, potentially resulting in a further decline in stock prices.

Interest Rate Risk

  • High dividend-giving stocks are particularly sensitive to changes in interest rates.
  • These stocks become more attractive when interest rates are low; however, a shift in monetary policy, such as the Federal Reserve’s rise in interest rates, can alter this landscape.
  • As interest rates increase, dividends become less appealing to investors than the potential returns from risk-free government bonds, like Treasury bonds.
  • This shift in perception may trigger an outflow from equities, disproportionately affecting most dividend-paying stocks in India over the long term.

Therefore, investors can diversify investments across different asset classes and industries with smallcase to mitigate risks while investing in the best dividend-paying stocks.

Dividend Yield vs Dividend Ratio

A dividend yield tells you the rate of return in cash dividends to its shareholders. Percentage represents dividend yield instead of the actual dollar value. This makes it easier for shareholders to calculate the dividend returns based on the percentage value. 

Another popular financial metric for many investors is the dividend payout ratio. 

On the other hand, a dividend payout ratio is the proportion of its net income that is distributed as dividends as compensation to its shareholders. Generally, dividend payout ratios are regarded as better indicators of a company’s financial strength because they directly relate to cash flow.

Factors to Consider Before Investing in the Highest Dividend Paying Stocks

Here are a few factors to consider if you are looking to invest in highest dividend paying stocks:

  • Payout or Yield Ratio Significance: High ratios imply fewer profits for business reinvestment. Formulaic assessment reveals if dividends divert significant profits.
  • Caution in Sole Reliance on Ratios: Highest dividends of the best dividend-paying stocks for the long-term don’t assure future investment success. Ratios are one of several factors in stock investment decisions.Investors must be cautious of relying solely on them to make their investment decisions.
  • Dynamic Nature of Yield Ratio: The yield ratio of the top dividend paying stocks in India fluctuates with changes in share market prices during trading sessions.
  • Avoid Fixating on Absolute Dividend Numbers: A share with a close price of Rs. 100 doesn’t inherently indicate a strong company. Similarly, a share with a close price of Rs 10 per share doesn’t necessarily denote a weak company.
  • Comprehensive Company Evaluation: Look beyond dividends when considering highest dividend yield stocks India; consider earnings, outstanding shares, and shareholders. Metrics such as ratios play a crucial role in this evaluation of high dividend yield stocks in India.

To Wrap It Up…

In conclusion, investing in India’s highest dividend yield stocks can be a good strategy for investors looking for a steady income source. Many companies offer dividends as compensation to their shareholders while signalling their healthy financial growth to keep the investor’s interest intact. All in all, investors can refer to our prepared dividend smallcases (offering Dividend portfolios like Smart Beta, Dividend Stars, and Dividend Aristocrats) that include the highest dividend paying companies offering high dividends to their shareholders over time. 

Frequently Asked Questions About Highest Dividend Paying Stocks

1. What are the highest dividend paying stocks in India?

The following companies have been sorted according to their dividend yield from our list of top 10 dividend yield stocks in India:
1. Indian Oil Corporation Ltd
2. Vedanta Ltd
3. Hindustan Petroleum Corp Ltd
Note: The data on this list has been taken on 11th June 2024. This list is for educational purposes only and is not recommendatory.

2. How can I invest in the highest dividend paying stocks?

Explore Dividend smallcases by Windmill Capital or the ‘DiviGrowth Capital’ smallcase to find out which suits your needs best. After aligning your investment goals with a particular smallcase, make your choice. But, one must consider the risk appetite and investment goals before investing in the highest dividend paying stocks.

3. Is it a good time to invest in the highest dividend paying stocks?

Investors can enjoy the advantages of capital growth and steady income by investing in good dividend stocks in India. Purchasing a high-dividend stock can lead to sustained benefits over time. However, investors must do their due diligence and research before investing.

4. Who should invest in the highest dividend paying stocks?

The best stocks for dividends, with their lower volatility, attract investors seeking reduced risk, particularly those approaching or in retirement. However, dividend-paying stocks in India pose risks if one is unfamiliar with potential pitfalls.

5. Can highest dividend paying stocks be profitable for investors?

Good dividend paying stocks in 2024 may offer a steady income and thrive in defensive sectors, demonstrating resilience during economic downturns with lower volatility. These dividend paying stocks, known for their substantial cash reserves, typically represent robust entities with promising long-term prospects.