Unilever Nepal, whose shares are being traded at close to Rs 10,000 a
unit, topped the list of dividend payers among the publicly listed
companies last fiscal, giving away Rs 680 on every stock held by
shareholders.Other public companies that paid substantial dividends to their shareholders are Sagarmatha Insurance Company, Nepal Life Insurance Company, Bottlers Nepal Tarai and Bottlers Nepal Balaju.
Of the 228 listed companies, only 127 distributed part of their earnings from the profit earned in fiscal year 2011-12 among their shareholders. Their average dividend payout – including both stock and cash – stood at Rs 62.45 per unit share in the last fiscal year.
Among the banking stocks, Standard Chartered Bank Nepal, Nabil Bank and Himalayan Bank offered dividend of 60 per cent of the paid up value to the investors. Shares of Standard Chartered Bank and Nabil Bank are being traded at a little less than Rs 2,000 per unit – highest among banks.
Even the insurance companies have been distributing huge chunks from profit – especially stock dividend – to the shareholders in order to increase regulatory capital. Stock dividends are paid in the form of additional shares rather than cash payout so that profit is capitalised.
“Investors prefer bonus shares to cash dividend from good companies, whose share prices are high, as good shares are more valuable than cash,” pointed out president of Nepal Investors Forum Raj Kumar Timilsina.
“The rate of dividend is one of the most important features that an investor considers before deciding to purchase a stock,” pointed out share analyst Rabindra Bhattarai. Moreover, the companies that offer high dividends are less likely to witness fall in stock price, thereby reducing volatility, added Bhattarai.
Meanwhile, the bullish stock market in the past one year has appreciated investors’ assets by almost 10 per cent, as market capitalisation of the stock market reached Rs 526 billion from Rs 480 billion a year ago. Investors expect handsome dividend from hydropower companies. Microfinance development banks have also become top dividend payers.
Top five profit sharers
Companies Dividend payment (per share)
Unilever Nepal Rs 680
Sagarmatha Insurance Rs 129
Nepal Life Insurance Rs 126
Bottlers Nepal Tarai Rs 85
Bottlers Nepal Balaju Rs 70
Source: Company announcements / THT
