Friday, 28 December 2018

Top 8 Dividend Paying Stocks In India For 2019






Top 8 Dividend Paying Stocks In India For 2019



There are two types of investors in this world. One type of investor wants growth of stocks. They basically want price appreciation of the stocks so that they can be benefited by the long-term gain. The second type of investor's main concern is a dividend. The dividend is given by the company out of profit. It is not mandatory but the companies who are distributing dividend regularly have a good reputation in the share market. So today we're going to discuss Top 8 dividend paying stocks In India.


8. Coal India

Coal India is a well-known company and its reputation in distributing dividend is quite good in the share market. This company is currently trading at 15.62 P/E ratio and EPS of ₹15.82. In FY 2018 coal India has given ₹16.5 as a dividend to its shareholders which comes to a dividend yield of 6.81%.



7.PFC

Power Finance Corporation is another company which distributes dividend regularly and at a good percentage. It offers you dividend more than the fixed deposits offered by most of the nationalized bank. This company is currently trading at 5.27 P/E ratio and EPS of ₹19.96. In FY 2018 coal India has given ₹7.80 as a dividend to its shareholders which comes to a dividend yield of 7.42%.



6.REC

Rural Electrification Corporation is a company which arranges finance for various kinds of loans and advances related to electricity. This company is currently trading at 4.49 P/E ratio and EPS of ₹27.16. In FY 2018 REC has given ₹9.15 as a dividend to its shareholders which comes to a dividend yield of 7.5%.



5. IOC

Indian Oil Corporation is an Indian state-owned oil and gas company with registered office at Mumbai. This company is currently trading at 5.79 P/E ratio and EPS of ₹23.87. In FY 2018 IOC has given ₹21 as a dividend to its shareholders which comes to a dividend yield of 15.2%.



4.HPCL

Hindustan Petroleum Corporation Limited has approximately 25% market share in India among public sector companies and strong market infrastructure. This company is currently trading at 5.99 P/E ratio and EPS of ₹42.71. In FY 2018 HPCL has given ₹17 as a dividend to its shareholders which comes to a dividend yield of 6.64%.



3.BPCL

Bharat Petroleum Corporation Limited is a government of India controlled maharatna company. This company is India's second largest downstream oil company. This company is currently trading at 9.42 P/E ratio and EPS of ₹38.4. In FY 2018 BPCL has given ₹21 as a dividend to its shareholders which comes to a dividend yield of 5.80%.



2.OIL India

Oil India Limited is the second largest hydrocarbon exploration and production Indian public sector company with its operational headquarter in Assam. This company is currently trading at 6.43 P/E ratio and EPS of ₹27.64. In FY 2018 OIL India has given ₹15 as a dividend to its shareholders which comes to a dividend yield of 8.44%.



1.Vedanta

Vedanta is a global diversified metals and mining company with its headquarters in London. This company is currently trading at 10.73 P/E ratio and EPS of ₹18.58. In FY 2018 OIL India has given ₹21.2 as a dividend to its shareholders which comes to a dividend yield of 10.63%.


I hope this article will help you in the future for taking decisions regarding dividend-paying stocks. I personally have REC in my portfolio and my only reason to hold this stock is to get the handsome dividend. That’s all for today.

Stay Happy, Stay Blessed.




Monday, 24 December 2018

What is P/E Ratio And How To Use This For Investment In Shares


What is P/E Ratio And How To Use That For Investment In Shares

We all know there are many fundamental tools and techniques to evaluate an investment related decisions. One of them is P/E Ratio of the company while you are going to invest in any share. So in this post, we are going to discuss what is the significance of this ratio and how to use it in while investing in any company. Let's start.


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The basic definition as per Investopedia is "The price-earnings ratio (P/E ratio) is the ratio for valuing a company that measures its current share price relative to its per-share earnings. The price-earnings ratio is also sometimes known as the price multiple or the earnings multiple." Though it is already in simpler words I want to make it more simple by saying that 'P/E Ratio is nothing but the payback period of your money. That may be something which can confuse peoples who know about P/E Ratio but it is perfect for a layman to understand what is P/E Ratio. I'll also show how this ratio can be treated as payback period of your investment through example. So let's check a case study. 

The formula to calculate P/E ratio is market price of its share divided by basic EPS.

Facebook has an EPS of $6.63 for the quarter ending September 30, 2018. Its market price as on December 21, 2018, is $124.95. Now if we go by formula then P/E ratio would be 18.85. But look at the formula given above and try to understand what is happening. EPS is the earning per share in a year. I will earn $6.63 in a  year and my market price is $124.95 and by dividing it with the EPS I'm getting a number which shows how many years it will take to get my money back. If I assume everything is constant and I started to earn $6 each year then it will take 18.85 years to get my investment of $124.95 in Facebook share. I hope it is clear now.

One of the definitions which are also easy to understand is "P/E ratio is the amount of money you are investing to earn a rupee." This definition is important when it comes to decisions making by using this ratio. Now let's check how to do that. 

How to use P/E ratio for purchasing shares?

Let's take the example of Reliance whose P/E is 20.02 and its peers BPCL whose P/E is 9.76 and HPCL whose P/E is 5.85. Now let's study how to use this ratio for purchasing any of the three shares. Suppose I'm an investor. What will I want? I should get maximum profit by investing less. But as for formula, I'm getting
₹1 by investing 20.02 in Reliance, 9.76 in BPCL and 5.85 in HPCL. If I assume that every other aspect of these three companies are constant then it is wiser to invest in HPCL because I have to invest as low as 5.85 to earn one rupee of profit. Again I'm saying this is the way to check if a company is available in the market at a cheaper price but we have to check the other aspects also who are important in investment decisions. Let's take few other examples.





Rule of thumb is to always invest in shares which have P/E ratio less then the industry's average P/E ratio with a growth intent of management.

So basically this ratio is very important to know the valuation of the company. If P/E is low then the company is available at a cheaper price and if P/E is high then it is expensive to buy. That's the reason I personally always watch this ratio before investing in any share. I hope this article will help you in your future decisions regarding investment related decisions. That's all for now.

Happy Investing.

Friday, 21 December 2018

Success Story Of Colgate, One Of The Bestselling Toothpaste Brand


Success Story Of Colgate, One Of The Bestselling Toothpaste Brand

"It cleans your breath while it cleans your teeth", can you guess whose slogan is this. If you have guessed correct then today I'm going to tell you the success story of one of the best selling toothpaste brands of India i. e. Colgate. It's popularity can be measured by thousands of situations where the term toothpaste is replaced by Colgate in India. Do you know, this brand came into being almost 210 years ago, introduced by Williams Colgate. And initially, this company used to produce soaps, not toothpaste that too in jars and not tubes. So now, let's get back to the beginning of the story. 

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The founder of Colgate, Willam Colgate was born on 25 Jan 1783 in England. His father was a farmer. But later, they shifted to Maryland in the US where his father along with a friend began to make candles and soaps. Unfortunately, after two years they had to close this business after falling into a big loss. This brought their economic conditions to depression. William, aged 16 then, decided to leave home and get some work. He left home and began to get engaged in small works. In 1804, he reached New York and got into a Soap factory. By then, he had decided that he'd run the same business. So he learned techniques and methods of business being in the factory. 




After working there for 2 years, he had known where lied the mistakes and what were the causes of loss. In 1806, in a small house, he started his own business of soaps. Initially, his business had good sales and profits. Soon his rent room converted into a well-planned house with a small factory. Unfortunately, meanwhile he got heart strokes and his health started to deteriorate. For several years, he couldn't focus on the business. As a result, the business bore losses. But once he was back to work, he doubled the sales and profits of the business. He was a believer of donations. So he donated much of his income.

Gradually with growing income, he reached donating 50% of his income. On 25 March 1857, he breathed his last. After him, his three sons handled the business. They took it forward in terms of oral hygiene. They introduced the Colgate toothpaste jar. With time and development in packaging, it became available in tubes.

Today, thousands of people work in this company. It started working with Palmolive company and made perfumes as well. So overall, the moral behind this story is that never give up even in the worst situations. And do believe in helping others.

Hope you're inspired.
Keep reading!

Monday, 17 December 2018

What is EPS And How It Is Used For Investing In Shares?


What is EPS And How It Is Used For Investing In Shares?

EPS, commonly known as Earning Per Share is the portion of a company's profit allocated to each shareholder of the company for holding one share of the company. It is the technical definition. Let's understand it in a simpler way.


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We all know when we start a business, it will either do profit or loss. Same happens with firms and companies. In the year-end company calculate the profit after paying tax to know the profit available to the shareholders. When company ascertains this profit then it calculates EPS or Earning Per Share by dividing that profit with the total number of share of the company.

Let's understand now by an example.

For the year ending on March 2018, Infosys reported a net profit ( Profit after tax ) 
16155 crores. Equity Dividend is ₹5623 crores and corporate dividend tax ₹1877. So let's see the diagram to understand how to calculate EPS.



So now we had checked how the EPS is calculated and what is its formula to calculate. now let's move further and know what is its use or why it is important to check EPS of a share before Investing.

The rule of thumb says that more the EPS better the share and this should be applied while choosing stocks. If you choose a stock for investing then check its EPS and compare the EPS of its peers in its industry. By doing that you will have a brief understanding of how the company is performing in its segments and how much return it is giving to its shareholders.

For an example, if one share is available at an EPS of 12, and another share of same industry is available at an EPS of 15 and both the shares are trading in the market at 110, then as per rule of thumb, we will select the second share having higher EPS. Let's check the EPS of different companies in the IT sector in India.



We can see that TCS has better EPS than its peers, so it is a wiser decision to buy TCS than any other company in IT Sector for the longer term. But EPS is not the only factor to check while investing in shares, there are also other factors which are relevant. We have discussed here the importance of EPS and if everything is same between two shares then we can use this rule to select the best one.

So, I hope you must have got clarity regarding EPS and how to use it while investing. Feel free to give your feedback in the comment section. If you have any question then you can ask me.

Thank You
Happy Investing

Friday, 14 December 2018

Success Story Of Haldiram



Success Story Of Haldiram

Hello friends, today I'm going to discuss an Indian brand which shows and proves how tiny steps can lead one to the peak of success. The brand is none other than Haldiram. It is the top brand of Indian food industry today. In fact, you can find the products of this brand all over the world today. Actually, it is not a brand but the entire flavor of the state of Rajasthan. So let's get to know the success story of Haldiram.
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The story of this Nagpur based company started in 1937, at Bikaner of Rajasthan when a man learned the recipe of making "bhujia" (a dry snack commonly used by the people of India). He then opened a stall making the same snack and earning his livelihood. A few years later, his son Gangavishan Agarwal tasted his father's snacks. He made some changes in the preparation process that made the snacks, even more, better, tastier and crunchier. He just tried to change the common snack into a new trendy one. And the next time, the stall was crowded with customers. A little experiment changed the overall sales of the shop.



After some months, the shop was renamed "Haldiram's". Actually, this was the other name of Gangavishan Agarwal. And as his experiments brought colors to the business, the family decided to use his name as the brand name.

With the passage of time, Haldiram brand opened its shops in various places like Nagpur, New Delhi and Bombay with a huge number of products including Snacks and Sweets, Dairy products, Ice cream, Cookies etc. It is rightly said that if you walk with time, you can achieve anything. The same happened with this brand. With time, the traditional shop took the shape of an international one. Today, as many as 100 food products of this brand are being sold in the market, that too with variations.

Haldiram reached another milestone by preparing "ready to eat" food products from 2010. It is highly popular among the working people who have less time to cook. Gradually, many Haldiram restaurants have been established in places like Delhi, Noida, Patna, Kolkata etc. Moreover, the brand didn't stay confined to India. It had gained popularity in other countries like Sri Lanka, UK, US, Canada, Japan, Australia, New Zealand, Thailand etc. with its subtitle being accurately defined "Taste of Tradition".



Like every story, this story also had ups and downs in business, but the effort and hope never went down. Heads hight and hands-on work can make wonders. The same happened with Haldiram. Day by day, it created new qualities and new flavors keeping in mind the satisfaction and requirements of customers. Then, the revenues increased at a high rate making the brand stand where it is today.

Hope you're inspired.
Keep reading!

Friday, 7 December 2018

Inspirational Story Of Ferrari


Inspirational  Story Of Ferrari

Hello friends, today I'm going to discuss one of the most popular sports car companies in the world - Ferrari. Today, each sports car lover dreams to get a Ferrari. It keeps gaining popularity till today. This company was founded by Enzo Ferrari. So let's get to know the success story of Ferrari.

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The story starts with 18 Feb 1898 when Enzo Ferrari was born in Italy. Enzo was fond of cars right from his childhood. At 10 yrs of age, he went to see a car race with his father. At that point in time, he decided that he would become a racing driver. After that, he attended many car races. After completing his graduation from Modena College, he worked as a teacher. But after a few months, he had to join the Italian army for the first World War. In 1916, he suffered a lot with emotions as well as the economy when his brother and father died. After returning from World War, he began to find jobs. He applied for FIAT but was rejected. After a lot of struggle, he got a job as a test driver.

Enzo had never studied automobile but due to his. passion in cars, he possessed great knowledge about cars. Recognizing his knowledge and talent, Enzo was promoted as a racing car driver. Then he participated in many races and events and also won many of them. Later due to the death of a fellow driver and friend, he got scared.




After the birth of his son, he decided to retire and began to look after the management and development of a company. After a few years, he started his own company which provided car parts to other companies. After the second world war, he started to design his own car. Then he launched Ferrari 125 and in a short period of time, the car gained a lot of popularity. The sale of the Ferrari car kept increasing. After that, there was no looking back for Enzo.


In 2014, Ferrari was rated the world's most powerful brand by Brand Finance and in May 2012, the 1962 250 GTO became the most expensive car in history, selling in a private transaction for US$38.1 million to American communications magnate Craig McCaw.

Throughout its history, the company has been noted for its continued participation in racing, especially in Formula One, where it is the most successful racing team, holding the most constructors championships and having produced the highest number of drivers' championship wins. Ferrari road cars are generally seen as a symbol of speed, luxury and wealth.

Today, Ferrari is included in the best sports cars list.

Hope you're inspired.
Keep Reading.

Monday, 3 December 2018

Why The Share Prices of Arvind Limited Went Down?


Why the share prices of Arvind Limited went down?


Hello and welcome to my blog. Today I am going to discuss Arvind Limited and why the share prices of Arvind Limited went down.

On 28th November shares of Arvind Limited fell as much as 71% in a single day. These types of incidents are becoming common day by day. Good examples are Yes Bank, Infibeam, Vakrangee. So why a huge fall? Is there any bad news or anything else, let's discuss.

This huge fall is due to the "demerger" of the company. I won't go in technical term but try to make you understand what is "demerger"? This is basically dividing the firm or company to different and small divisions so that the company can focus on their strength areas. I will definitely write a detailed article about "demerger" in near future to give a full understanding of the concept.




Last year Arvind limited announced demerger and in October 2018 the NCLT had sanctioned this arrangement. So now Arvind limited will be divided into three companies named as Arvind limited, Arvind Fashion limited and Anup Engineering. Now Arvind limited after demerger will primarily focus on textiles business.

So if you had kept the shares of Arvind Limited then now you will get 5 shares of Arvind Fashion and 27 shares of Anup engineering for every share of Arvind limited. For actual valuation, we have to wait for fo the listing of these shares which will be June 2019. So there is not actually bad news or anything rather the distribution of shares and you should not go panic for the price which you are watching now in the market.

If you had any doubt you can ask me in the comment box and I'll try to explain it.


Stay Healthy, Happy Investing.