Having dividend stocks in your demat account can help you maximize your account portfolio with a reliable income stream. Dividends from high-performing firms with a track record of paying regular dividends boost dividend yields. As a consequence, shareholders of three maharatna companies, Oil India, BPCL, and IOCL, should keep an eye on the stocks since the Board of Directors has recommended dividend payouts.

Oil India

The board of directors recommended a final dividend of Rs. 5/- per share (i.e. @ 50% of paid-up equity share capital) for the financial year 2021-22 at its meeting on May 27th, subject to shareholder approval at the succeeding Annual General Meeting (AGM). The company has said in an exchange filing that “The Final Dividend 2021-22 would be paid within 30 days from the date of its declaration at the AGM. The Record Date/Date of Book Closure for payment of final dividend would be fixed and announced in due course."

During FY 21-22, Oil India Limited achieved the highest ever Profit After Tax (PAT) of Rs3,887.31 crore, up from Rs174,59 crore the previous year. Total income increased by 27% in the fourth quarter to Rs4,972.91 crore, and by 55% in the fiscal year to Rs16,427.65 crore. The brokerage firm Pradhudas Lilladher has said in a report that “We believe OINL’s earnings will ride on improving crude oil and gas realization, along with expansion of Numaligarh refinery (NRL) by 6MTPA (3MTPA capacity). Maintain ‘BUY’ with TP of Rs344 (Rs360), based on 3.5x/EV/E FY24E (5x earlier) and add value of investment in IOCL. We cut our target multiple due to concerns of subsidy sharing given large marketing losses which should come off as global refiners come back from maintenance shutdown."

BPCL

The board of directors of Bharat Petroleum Corp Ltd (BPCL) has recommended a final dividend of Rs6 per equity share for the fiscal year 2021-22 subject to shareholder approval at the company's next Annual General Meeting (AGM). In the quarter ended March 31, 2022 (Q4FY22), the firm reported a standalone net profit of Rs2,130.53 crore, down 82.15 percent from the profit of Rs11,940.13 crore in the previous fiscal quarter. The company's revenue from operations was Rs1,23,550.93 crore, up 25.09 percent from Rs98,763.80 crore in the previous quarter, while market sales for the year ended March 2022 were 42.51 MMT, up from 38.74 MMT in the previous year. Revenue increased to Rs4,33,406.48 crore from Rs3,01,873.16 crore in FY21, while standalone PAT stood at Rs8,788.73 crore from Rs19,041.67 crore in FY21 for the full year FY22.

The brokerage firm Emkay Global said in a report that “We value BPCL on a SOTP basis, with investments at a 30% holdco discount. We slightly lowered the target EV/EBITDA multiple from 5.6x to 5.4x with no disinvestment premium anymore. While the current scenario is weak with negative auto-fuel margins, we maintain Buy owing to reasonable valuations and expectations of a gradual recovery in margins to normative levels. Key risks: adverse commodity/currency/polices/capex."

IOCL

The company has said in an exchange filing that “the Board has recommended a final dividend of Rs. 3.60 per equity share having face value of Rs. 10/- each (pre-bonus), which translates into final dividend of Rs. 2.40 per equity share having face value of Rs. 10/- each (post-bonus) for financial year 2021-22, subject to the approval of the shareholders of the Company. The final dividend would be paid within 30 days from the date of declaration at the AGM. The final dividend is in addition to the Interim Dividend(s) of Rs. 9.00 per share (pre-bonus) paid for the financial year 2021-22. The record date for payment of final dividend would be fixed and intimated in due course."

“Further, the Board has recommended issue of Bonus Shares in the ratio of 1:2 i.e. One new bonus equity share of Rs. 10/- each for every Two existing equity shares of Rs. 10/- each fully paid up subject to the approval of shareholders through postal ballot. The Board has fixed 1 July 2022 as record date to determine the eligibility of shareholders to receive bonus shares," Indian Oil Corporation Ltd (IOCL) said.

According to Motilal Oswal, IOCL is set to commission various projects over the next three years, driving growth further. Refinery projects currently underway are expected to be completed as follows: Panipat refinery (to 25mmtpa) by Sep’24, Gujarat refinery (to 18mmtpa) by Aug’23, and Baruni refinery (to 9mmtpa) by Apr’23, as per its earlier guidance.

The brokerage has maintained a target price of INR164 per share and the company is likely to benefit the most among its peers from an uptick in refining margin, further supported by a robust petchem margin in the near term, as per the brokerage.