Several major Indian companies are set to trade ex-dividend in the coming week, offering potential income opportunities for investors. Trading ex-dividend means that the stock's price will be adjusted to reflect the dividend payout, and new buyers will not be entitled to the dividend. To receive the dividend, investors must own the shares before the ex-dividend date.
ITC
ITC Ltd, a diversified conglomerate, has declared a final dividend of ₹7.85 per share for the financial year ended March 31, 2025. Including the interim dividend of ₹6.50 per share already paid on March 7, 2025, the total dividend for FY25 amounts to ₹14.35 per share. The record date for determining entitlement for the final dividend payment is May 28, 2025. The final dividend, if approved at the Annual General Meeting (AGM) scheduled for July 25, will be credited to eligible shareholders between July 28 and July 31. ITC's consolidated net profit for the fiscal year surged to ₹19,727 crore, driven by exceptional items and strong performance in the cigarette segment.
Infosys
Infosys, a leading IT services company, has announced a final dividend of ₹22 per equity share for the financial year ended March 31, 2025. The record date for this dividend is May 30, 2025, and the payment date is set for June 30, 2025. The company’s board recommended the dividend on April 17, 2025. Earlier, Infosys had distributed an interim dividend of ₹21 per share in October 2024. For FY25, Infosys reported revenue of $19,277 million, representing a 4.2% growth in constant currency.
Angel One
Angel One, a well-known name in the broking and financial services sector, has announced a final dividend of ₹26 per share for FY25. The company's shares saw a rally despite a 48.7% drop in Q4 net profit and a 22.2% revenue decline. Earlier in the fiscal year, Angel One had already paid interim dividends of ₹11 each in January and March. The final dividend is subject to approval by the members at the Annual General Meeting (AGM) and will be paid within 30 days of the AGM.
Other Companies
Besides ITC, Infosys and Angel One, several other companies are also going ex-dividend this week. These include:
Dividend Investing Considerations
While dividends can be an appealing source of income, it's essential to consider several factors before investing in dividend-paying stocks. A high dividend yield might seem attractive, but it could also indicate underlying financial weaknesses or potential dividend cuts in the future. It's crucial to assess the company's financial health, consistent earnings, leadership, and long-term growth prospects. A dividend yield of around 3-4% is often considered a healthy balance, suggesting a sustainable dividend payment.
Tax Implications
As per the Indian Income Tax Act, 1961, dividends are taxable in the hands of shareholders. Companies are required to deduct tax at source (TDS) at applicable rates. Resident shareholders with a valid PAN are subject to a 10% TDS, while those without a PAN face a 20% TDS. Non-resident shareholders are taxed at rates prescribed under the Income Tax Act or relevant Tax Treaties. No tax is deducted if the dividend payable to a resident individual shareholder is up to ₹10,000 per annum. Infosys, for example, has provided detailed guidelines and a shareholder portal to assist shareholders in submitting necessary documents for TDS determination.
