Indian tobacco corporation is one of the high dividend paying stocks in India.
There are a very few handful of companies that are century-old and listed in the Indian share market. One among them is ITC limited. This conglomerate is headquartered in Kolkata. ITC was established in 1910 as Imperial tobacco company and renamed as India tobacco company in 1970 & later as ITC limited.
There was a long period of time where ITC stock moved sideways, though nothing wrong with ITC fundamentals, business, profit margins. We need consider the negative sentiments too like high regulator tax, campaign against smoking etc.
It could be a period of discouraging for investors, it reminds a quote of Legendary Peter Lynch.
ITC holds 80 percent market share in tobacco sector in India. No matter how negative campaign against consuming tabacco, there is no slowing down in cigarette sales.
Due to high cash generation , less reinvestment in tobacco business, ITC is emerged as one of the high dividend blue chip stocks in India.
If you are a person who loves dividend paying stocks in India , You must take a look at ITC. I will cover about dividends ITC paid for its investors and why it could make you rich.
ITC- Dividend paying stocks in India
As I had mention earlier, only a very few companies in India are century-old and listed in the NSE & BSE market exchanges. One among them is ITC limited. This conglomerate is headquartered in Kolkata. ITC was established in 1910 as Imperial tobacco company and renamed as India tobacco company in 1970 & later as ITC limited.
Initially, the business focus was on the tobacco industry & manufacturing of cigarettes.
Today, ITC businesses have grown into verticals such as FMCG – Packaged foods, Hotels, Agribusiness, Paper boards & printing, Lifestyle retailing, Education & stationery products.
Below are the brands which are owned by ITC today.
ITC IPO
In 1970, ITC equity shares were offered to the public at the price of Rs 3 per share.
If you would have bought shares worth Rs. 10000 in 1970, You would have been allotted 3334(10000/3).
Bonus and share split
1978: 1:5 bonus (1 share for every 5-shares held)
So, 666 shares for 3334 shares were held.
Total shares: 4000
1980: 1:5 bonus (1 share for every 5 shares held)
Then 800 shares you get for 4000 shares held.
Total shares: 4800
1989: 1:1 bonus (1 share for every 1 share held)
Then 4800 shares you get for 4800 shares held.
Total shares: 9600
1991: 3:5 bonus (3 shares for every 5 shares held)
Then 5760 shares you get for 9600 shares held.
Total shares: 15360
1994: 1:1 bonus (1 share for every 1 share held)
Then 15360 shares you get for 15360 shares held.
Total shares: 30720
2005: 1:2 bonus (1 share for every 2 shares held)
Then 15360 shares you get for 30720 shares held.
Total shares: 46080
2005: Split (Face value from Rs 10 to Re 1)
For every 1 share, you get 10 shares.
Total shares: 46080 *10 = 460800
2010: 1:1 Bonus (1 share for every 1 share held)
Then 460800 shares you get for 460800 shares held.
Total shares: 921600
2016: 1: 2 Bonus (1 share for every 2 shares held)
Then 460800 shares you get for 921600 shares held.
Total shares: 1382400
As of November 2022, the share price of ITC is 340.40.
So, the total return will be around 340.4* 1382400 = 47 Crores. ( approximately $6 million USD)
This amount is capital appreciation of stock without considering dividends paid. Remember! ITC is one of the high dividend yield stocks India.
Continue reading further to know how much you would earn in dividends alone.
Dividends paid
For more than 20 years ITC paid dividends consistently to its shareholders.
Read more about: How Buffett made outstanding dividends from his coke stocks?
Let us look at the dividends ITC paid below.
| Dividend History | ||
| Year | Dividend per share | Dividend Yield |
| 2001 | 10 | 0.88% |
| 2002 | 13.5 | 1.28% |
| 2003 | 15 | 1.32% |
| 2004 | 20 | 1.30% |
| 2005 | 31 | 1.17% |
| 2006 | 2.65 | 1.01% |
| 2007 | 3.1 | 1.33% |
| 2008 | 3.5 | 1.45% |
| 2009 | 3.7 | 1.17% |
| 2010 | 10 | 2.09% |
| 2011 | 4.45 | 1.25% |
| 2012 | 4.5 | 1.25% |
| 2013 | 5.25 | 0.99% |
| 2014 | 6 | 1.19% |
| 2015 | 6.25 | 1.31% |
| 2016 | 8.5 | 1.39% |
| 2017 | 4.75 | 1.49% |
| 2018 | 5.15 | 1.87% |
| 2019 | 5.75 | 1.88% |
| 2020 | 10.15 | 4.89% |
| 2021 | 10.75 | 5.01% |
| 2022 | 11.50 | 3.86% |
You can see dividends per share and the dividend yield is increasing year by year.
Now let’s calculate how much dividend you would have earned for the past 5 years.
As of 2016, You have 13,82,400 shares.
Last 6 years Dividend calculation
In 2017, You would have earned 65,66,400 (65 lacs).
In 2018, You would have earned 71,19,360 (71 lacs).
In 2019, You would have earned 79,48,899 (79 lacs).
In 2020, you would have earned 1,40,31,360 (1.4 cr)
In 2021, You would have earned 1,48,60,800 (1.48 Cr)
In 2022, you would have earned 1,58,97,600 (1.58 Cr)
In past 6 years the total earnings from dividend would be a whopping 6.6 Cr rupees.
If you come across anyone who says ITC is a lousy investment, remember the wealth it generated for its investors.
I hope this article was helpful to you. Let me know your comments about other interesting high dividend blue chip stocks in India.
Thanks for reading!
