Shares of ITC Ltd., and Page Industries Ltd., will be of interest on Tuesday, as the day marks the last session for retail investors to buy shares to qualify for receiving the dividend before the stock goes ex/record-date.
The record date determines the eligible shareholders who will receive the dividend payment. The ex-dividend date, which mostly coincides with the record date, marks when the share price adjusts to reflect the upcoming payout.
ITC Ltd., declared a final dividend of Rs 8 per share. The company will be a paying a total dividend amount of Rs 14.50 per share, as it had announced an interim divided of Rs 6.50 in January.
Page Industries Ltd's have announced a substantial interim dividend of Rs 150 per share, the record date of which is May 27.
ALSO READ: Dividend Alert: ITC Ends Two-Year Miss Streak; Check Record, Payout Details
T+1 Settlement Cycle
Given India's T+1 settlement cycle, shares purchased on the record date (May 27 in this case) will not be eligible for the dividend payment. Therefore, investors who own shares by May 26 will be the beneficiaries.
Dividends are a way for companies to reward shareholders. It is the portion of profits that a company distributes to its shareholders and is essentially a return on the investment shareholders make in the company's equity. Such payments are made through final, interim, and special dividends.
Dividends are taxable in the hands of the shareholders, and companies are no longer required to pay the Dividend Distribution Tax (DDT). The TDS on dividend income for resident individuals is 10% if the dividend amount exceeds Rs 5,000 in a financial year.
ALSO READ: Page Industries Q4 Results: Topline Rises 14%, Dividend Declared — Check Record Date
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