Dividend stocks have their own place in any long-term portfolio. They not just provide the scope for capital appreciation, but also rewards investors in the form of regular payouts. Generally, utility companies are more suitable for dividend portfolios, owing to their consistency of cash flows.
In that vein, here are 2 companies that are currently trading at the highest dividend yield in this space. Companies with a market capitalization of less than INR 10,000 crores have been omitted from this list.
POWERGRID Infrastructure Investment Trust
POWERGRID Infrastructure Investment Trust Unit (NS:POWG) is actually a trust, sponsored by Power Grid Corporation of India Limited (NS:PGRD). The company’s aim is to achieve stable distributions by focusing on owning power transmission assets and maintaining high transmission availability. Some of its major unitholders are SBI Life Insurance (NS:SBIL), ICICI Lombard, HDFC Mutual Fund etc. and FIIs hold a decent 22.48% stake in it.
The trust’s revenue jumped 8% YoY to INR 1,054.74 crores in FY23 but due to a negative EBITDA, it incurred a loss of INR 276.1 crores which was its first loss-making year since listing. Despite a loss, it declared a dividend of INR 15 per share in FY23 and is currently trading at a double-digit dividend of 10.12%. Over the last three years, the trust has maintained a very healthy payout ratio of 0.68 (average).
SJVN Limited
SJVN Ltd (NS:SJVN) is primarily engaged in the business of generation and sale of power via its thermal power segment. It has a market capitalization of INR 14,107 crores and is one of the very few small-cap companies that have become a darling for dividend investors. The company’s revenue almost remained the same for the last many years, with the FY23 figure of INR 3,286.75 crores.
However, its high payout ratio of 0.71 is what attracts investors and the stock is trading at a massive dividend yield of 9.25%, considering its FY23 payout of INR 3.32 per share. Big mutual funds are also taking interest in this stock, as their stake has gone up from 3.21% in March 2022 to 3.9% in March 2023.