TECH MAHINDRA DECLARES SPECIAL DIVIDEND OF RS 18 PER SHARE

Tech Mahindra, the fifth-largest IT services company in India, declared a special dividend of Rs 18 per equity share of face value of Rs 5 each. This makes the dividend at 360% of the face value. The company made the announcement on November 1 while releasing its financial results for the fiscal second quarter ending September 2022.

“The Board of Directors at its meeting held on November 1, 2022, has declared a Special Dividend of Rs 18 per equity share on face value of Rs 5/- each i.e. 360% of the face value," Tech Mahindra said in a regulatory filing.

The company also said that it has fixed November 10 as the record date to determine the eligible shareholders for dividend benefit. It will pay the special dividend on November 24, 2022.

The eligible equity shareholders are those whose names appear on the Register of Members of the Company or in the records of Depositories as beneficial owners of the shares as on the record date, which is November 10, 2022.

Tech Mahindra has a strong track record of distributing dividends to its shareholders. In the Financial Year 2021-2022, the IT services company declared a total dividend of Rs 45 per share, which is 900% of the face value. The current dividend yield of the company is around 4.2%.

For the second quarter of FY22, Tech Mahindra posted a consolidated net profit of Rs 1,285 crore, a 4% decline from Rs 1,338 crore in the same quarter last year. Sequentially, net profit grew 13.6%.

Revenue for the quarter under review stood at Rs 13,129 crore. This was up 20.6% from Rs 10,881.3 crore YoY. Revenue increased by 3.3%, QoQ. In dollar terms, revenue was at $1,638.1 million, growing 0.3% QoQ and 11.2% YoY. Revenue growth was at 2.9% sequentially in constant currency terms.

As on November 4, Tech Mahindra enjoys a total market capitalisation of Rs 1,01,276 crore on NSE. The shares of Tech Mahindra have fallen over 41% so far in 2022. However, in the last three years, the shares of the IT services company have risen more than 35%,

Tech Mahindra has declared a total of 24 dividends since March 2007, as per the data. A dividend is the share of profit, or a reward, cash or otherwise, that a company gives to its shareholders. The board of directors of a company decides the dividend, and the shareholders approve it. The dividend payments must be completed within 30 days of its approval.

It is to be noted that the day on which the board of directors of the company approved the dividend rate per equity share is called the Declaration date.

Meanwhile, the record date is the day proposed by the company’s board of directors to identify the names of eligible shareholders for dividend benefits. The last day to buy the shares to be eligible for a dividend is called the Cum Dividend Date, while the one working day before the record date is the ex-dividend date. This date on which the dividend payout to eligible shareholders is completed is the Payment date.

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