Vedanta to receive Rs 5,843 crore as dividend from Hindustan Zinc

Share of Vedanta is likely to move higher on Wednesday after its subsidiary Hindustan Zinc on Tuesday announced a dividend of Rs 21.30 per share.

Latest shareholding data showed that billionaire Anil Agarwal-led Vedanta held 2,74,31,54,310 shares, or 64.92 per cent, stake in the company as of September 30. This translates to a dividend amount of Rs 5,843 crore.

Ajit Mishra, VP - Research, Religare Broking said, “The announcements of dividend by Hindustan Zinc may result in favourable movement in Vedanta on Wednesday.”

In a regulatory filing, Hindustan Zinc said, “The board of directors of the company at its meeting held on October 20, 2020, have approved an interim dividend of Rs 21.30 per equity shares, i.e., Rs 1,065 per cent on face value of Rs 2 per share for the financial year 2020-21 amounting to Rs 9,000 crore.”

Country’s biggest institutional investor Life Insurance Corporation of India held 8,33,07,689 shares in the company, while the government had 1,24,79,50,590 shares, or 29.54 per cent stake.

Hindustan Zinc reported a 6.7 per cent drop in net profit to Rs 1,940 crore for the quarter ended September 30, 2020, due to high expenses. The company had posted a net profit of Rs 2,081 crore in the corresponding quarter last year.

However, total income of the company increased to Rs 6,050 crore in the July-September period from Rs 5,101 crore in the year-ago period.

Total expenses of the company during the quarter increased to Rs 3,428 crore from Rs 3,014 crore in the year-ago period.

The announcement came post market hours. Earlier during the day, shares of Vedanta closed 2.53 per cent higher at Rs 99.20. On the other hand, Hindustan Zinc settled 0.97 per cent higher at Rs 222.95.