The dividend offered by Samvardhana Motherson International Ltd (SAMIL) has proven to be consistent but modest in terms of yield. For FY23, the company declared a final dividend of ₹0.65 per share, translating to a dividend yield of around 0.41% at its current stock price. The company has a history of paying dividends regularly, including bonuses, with an average payout ratio of around 20% of its earnings. This ensures that the dividend payments are well-covered by its profits, which is appealing to long-term, stable-income investors.
Although the yield may not be high compared to other dividend stocks, Samvardhana Motherson is focused on growth through reinvestment and acquisitions, which could offer more capital appreciation opportunities than income. The company’s ambitious Vision 2025 plan, aimed at achieving $36 billion in revenue, further underscores its focus on reinvestment rather than high dividend payouts.
Conclusion
For investors seeking stability and long-term growth, the dividend from Samvardhana Motherson offers a safe but relatively low yield. It suits investors who value a balance between modest income and the potential for share price appreciation.
FAQ
1. What is Samvardhana Motherson’s current dividend yield?
The current dividend yield is 0.41%, based on the most recent payout.
2. How frequently does Samvardhana Motherson pay dividends?
The company has a history of declaring dividends annually, with occasional bonus payouts.
3. Is the Samvardhana Motherson dividend safe?
Yes, the dividend is well-covered by the company’s earnings, with a payout ratio of around 20%, ensuring sustainability.
4. What is the company’s growth strategy?
Samvardhana Motherson is focused on growth through reinvestment and acquisitions, as part of its Vision 2025 plan.
5. Is Samvardhana Motherson more suited for income or growth investors?
While the dividend is stable, the company is better suited for growth investors, as it focuses more on capital appreciation through business expansion.
