Silver Lining: Dividend yields get attractive

The sustained fall in the Indian equity market has made the dividend yields of some well-managed companies that pay dividends consistently, attractive.

The benchmark indices have lost over 10 per cent in a month and 14 per cent in six months. While such a sustained weakness makes it diffi cult for investors to identify growth stocks, they can opt for companies with good corporate governance, a stable business model and a consistent dividend-paying record. This is because a signifi cant fall across the broader market often tends to improve dividend yields of such companies.

In addition, dividends are tax-free in the hands of investors, which makes them even more attractive in times of market turmoil. The ET Intelligence Group has made a list of companies whose dividend yields have become attractive after Friday’s stock market fall.