Thursday, April 23, 2009

SEBI mandates Rs. per share dividend declaration

In a good move, the Securities and Exchange Board of India, SEBI, has asked listed companies to declare dividends on a per share basis rather than on a percentage basis. For example, a company having shares of face value Rs. 10, and declaring a dividend of Rs. 5, will have to say that it has declared a dividend of Rs. 5 per share and not a dividend of 50%.

This is meant to bring more clarity to an average investor who sometimes gets caught up in the jugglery of percentages and values when companies declare dividends. Thus, it will bring uniformity in the declaration of dividends by listed companies.

The move will clear the confusion among share holders whether the dividend declared was a percentage of the face value or the market price. It also becomes relevant when companies reduce the face value of shares over a period of time, which some investors might not be able to track.

Also, the calculation of actual returns in terms of Rupees becomes much easier, when the dividend information is available on a per share basis. Share holders will just have to multiply the number of shares they own by the dividend per share amount that the company declares. And for the mathematically inclined, they can just go ahead and calculate the dividend percentage if they want.

The change will be with immediate effect. More news here.

Related Articles
- How does Short Term Capital Gain/Loss work?
- Application Supported by Blocked Amount for IPOs
- Online share trading websites of India
- What are the 30 Stocks of BSE SENSEX

10 comments:

Elena Montes said...

Well this is indeed a great move by SEBI. This will help bring in the interest of the retail customers.

financemaster said...

A grt move by SEBI. U can get more information about income tax return in india on http//www.elagaan.com

Joseph said...

That would probably balance and clear the confusion of these companies in terms of shares.

sr&ed tax credit

Dividend said...

With the many blogs which I have encountered, I never expected to see a very beautiful post online..After reading this one, I felt so lucky to see its content..-)

Unknown said...

If you are looking for a data feed solutions provider for your site you should choose one that covers a wide selection of exchanges, including the BATS Exchanges, NASDAQ, NYSE and others. In fact, Barchart Market Data Solutions allows their customers to personalize their website feed to only show what they want. For example, you can make your feed exclusively a BATS data feed simply by changing your preferences.

Veterinarian practice financing said...

Thank you for your great post. This blog is great.

PENNY STOCK INVESTMENTS said...

another fine post.

kayakama said...

I want to appreciate it toward hobbies another person create however circulating this kind of write-up. Now i am seeking to get the best function within the exact same by way of another person on the medial side strong. SPA Edmonton

akai. said...

Best Guest Post Network
Best Guest Post Network
Best Guest Post Network
Best Guest Post Network
Best Guest Post Network

QuickBooks Customer Service said...

Very nice service! Initially, i was skeptical but the QuickBooks Customer Service 855-624-1268 The team did a fantastic job. I recommend others to use their service.