- Date : 25/07/2022
- Read: 2 mins
According to Gaurav Dua, Sharekhan, sectors like energy, oil, and gas are the best. He advises investing in companies like Coal India, Oil India, and Power Grid.
The recommendation of the analysts amid these volatile times is to invest in stocks with high dividend returns. This recommendation came amid a recent sell-off stock market. According to Gaurav Dua, Head of Capital Markets Strategy, Sharekhan, sectors like energy, oil, and gas are the best. He says that organizations of these sectors have gone beyond the benchmark Nifty index by an impressive 24%. As against an 11.3% Nifty index drop, these organizations are showing a delightful high dividend yield of 12.9%.
He advises investing in companies like Coal India, Oil India, and Power Grid. Stocks of these companies are likely to produce high dividend yields as well as significantly grow.
There is little reason to worry about this trend slowing down. This is because 2022 is expected to be quite challenging for the government to meet divestment goals. As such, the government may well go for higher dividends.
What is Share:
The dividend yield refers to an organization’s ratio of its annual dividend to its share price. For example, if the stock trading takes place at INR 1000, while the annual dividend is INR 10 per share. In such a case, the dividend yield would be 10%. This ratio increases when there is a drop in stock prices and vice versa. According to financial analysts, the average dividend yield of India's top 100 Indian organizations is roughly 1.5%.
The indices of Nifty, Nifty Midcap 100, and Nifty Smallcap 100 are all going down under the current circumstances. They are down by17%, 22%, and 32%, respectively, after their long-standing 52-week highs.
As the market situation is quite volatile, analysts are recommending organizations that are characterized with a strong dividend payment track record and impressive cash flows.
In conclusion, PSUs like Oil India, NLC, Ircon, PTC, and Coal India are the most profitable stocks in the current financial situation.
Disclaimer: This article is meant for general financial purposes only. You must not take it as any form of investment advice. You must seek a separate independent advice when indulging in financial decision-making.