These large-cap stocks have dividend payout ratio above 50%, do you own any?

Dividend Payout Ratio is a financial metric that measures the proportion of a company’s earnings paid out to shareholders in the form of dividends. It provides insight into how much profit is being returned to shareholders versus how much is being retained in the business for growth and other purposes.

If a company’s payout ratio is 30%, it indicates that it has distributed 30% of the earnings to shareholders and kept the remaining 70% of net income with itself.

The dividend payout ratio formula is expressed as:

Dividend Payout Ratio = Dividends paid / Net earnings ( Earnings Available for Equity Shareholders) or Dividend Per Share (DPS)/Earnings Per Share (EPS)

The ratio is represented in terms of a percentage.

Here are 11 stocks whose dividend payout ratio is above 50% with market capitalisation above ₹2 lakh crore.

HCL Technologies Ltd - The company has a history of rewarding its shareholders with consistent dividend payouts. In FY24 its dividend payout ratio was 89.91% with EPS of ₹57.86.

ITC Ltd - FMCG major is also known for its consistent dividend payout policy. Its EPS for FY24 stood at ₹16.39 with a dividend payout of 83.91%.

Nestle India Ltd - It too has a strong reputation for rewarding its shareholders with consistent and growing dividends. Its EPS for FY24 remained at ₹40.79 with dividend payout of 78.94%.

Infosys Ltd - India’s leading IT company is also known for hefty dividend payouts. Its EPS for FY24 was at ₹63.20 with payout of 72.63%

Hindustan Zinc Ltd - One of the favourite stocks of dividend-oriented investors in FY24 EPS remained at ₹18.43 with a payout of 70.53%.

Power Grid Corporation Ltd - PSU has a strong track record of dividends and EPS stood at ₹16.74 with a payout of 67.19%

Bharti Airtel Ltd - The telecom company’s EPS was at ₹13.20 with a payout of 61.64% for FY24.

Asian Paints Ltd - India’s largest home decor’s EPS remained at ₹56.92 with a payout of 58.50%.

Tata Consultancy Services Ltd (TCS) - India’s largest IT company by m-cap, EPS reported at ₹126.88 with a payout of 57.56%.

Bharat Electronics Ltd - The company is not as generous as the above companies for dividend payout. However, it has a consistent dividend policy with a payout of 53.20%, while its EPS stood at ₹5.45.

Stocks with dividend payout above 50% with market capitalisation above (₹2 lakh crore)

(Source - Screener.in)

The above analysis illustrates that several large-cap companies, particularly in the IT and FMCG sectors, prioritise returning profits to shareholders through high dividend payouts ( above 50%). Hindustan Unilever leads with a payout ratio of 96%, and Power Grid Corporation and Bharat Electronics represent high payout among the PSU sector.