The due date for the payment of the interim dividend is July 15.
On July 8, Hindustan Zinc declared an interim dividend of Rs 7, equivalent to a total outlay of Rs 2,957.72 crore. Vedanta Limited, which owns 64.92 percent of the zinc producer, will get a dividend of Rs 1,920 crore.
The record date for the payment of the first interim dividend of the current fiscal year is July 15, 2023, and it will be paid within the legal timeframe, according to the firm.
In FY23, Hindustan Zinc announced a dividend of Rs 75.5, implying a cash outflow of $3.9 billion (about Rs 32,000 crore). According to CLSA analysts, the FY23 dividend outlay converted the corporation from “net cash to net debt.”
The dividend payout made by Hindustan Zinc in FY23 was more than three times its full-year net profit of Rs 10,520 crore.
As is customary, the majority of Hindustan Zinc’s dividend is paid to Vedanta Ltd, while the majority of Vedanta Ltd’s dividend is paid to the promoter Vedanta Resources (VRL).
According to analysts, a large portion of these dividends are utilized to service debt.
Vedanta Ltd’s total dividend outgo in FY23 was Rs 37,700 crore, which was more than double the company’s net profit of Rs 14,503 crore.
VRL, based in London, announced on May 31 that it had returned $400 million in loans, bringing its total debt to $6.4 billion. According to the corporation, it has paid off all of its maturing loans and bonds due in May and June 2023. At the end of March 2022, its gross debt was $9.7 billion.
Previously, the promoter group promised 4.4 percent of its stake in Vedanta Ltd in exchange for a $250 million loan from Switzerland-based mining and natural resources rival Glencore International AG. Trafigura Group, a commodities trading corporation, provided $200 million in financing.
Vedanta Ltd’s entire promoter holding is committed, whereas Hindustan Zinc’s entire promoter holding is pledged.