Playing the dividend game

Dividends are payments (made out of profits) made by companies to their shareholders. Dividend investing is a style of investing where investors invest primarily in companies that pay regular and high dividends. This style is usually adopted when you want a steady income either for yourself or your dependents.

It is normally assumed that one has to invest either in bonds or in annuity plans to get an income every month, but that's not really the case. One can invest in equity and still get a certain level of fixed income, with sufficient initial investment. If a person requires a monthly income of Rs 25,000 or Rs 3,00,000 per year and assuming that the dividend yield is 4 per cent, it requires an initial investment of Rs 75,00,000!

We have shortlisted some companies that offer regular dividends. But here is the thing: one cannot just look at dividend yield while investing, some other basic factors are to be checked. We have used the following filters to arrive at the following list of companies as these filters make sure that you invest in good companies:

DISCLAIMER: Readers should do their due diligence on each of these companies if they choose to invest based on this list. While there are some great companies in this list, there are also some companies that have been inconsistent. Our filters make sure the company is good at the bare minimum, but there are various other factors that should be taken into consideration while investing.

If you don't have the time to do the work or don't really want to do it (we understand, don't worry), you can always subscribe to Value Research Stock Advisor where we have suggested dividend stocks and even have a ready-made portfolio for you, backed with sufficient research and background.