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All about Dividend and list of highly paid dividend

Welcome again to our blog, In this blog we discuss about dividends, highest dividends paid company,how to calculate dividend. Let's began our journey towards investment.

About Investment:

Investment is putting money into something with the hope of getting more money back in the future. It's like planting seeds with the expectation that they'll grow into a bigger harvest.This can be done through various financial instruments such as stocks, bonds, real estate, or starting a business. 
The goal is to increase the value of the initial investment or receive a return in the form of dividends, interest, or capital gains.
Let's break term dividend:
A dividend is a portion of a company's profits that is distributed to its shareholders. It's a way for investors to receive a share of the company's earnings, typically in the form of cash payments or additional shares. Dividends are often paid regularly, providing investors with a source of income from their investment in a particular stock.

Cash dividends:

Cash dividends means giving dividend in the forms of cash. Some company gives cash dividends to their inventory. If company proposed cash dividends, it means investor will get cash money in their Demat account.

Bonus share (Additional Share)

A bonus share is a free additional share given by a company to its existing shareholders. This is typically done as a gesture of sharing profits or accumulated reserves with the shareholders without any cash transaction. It doesn't change the overall value of the investment, but it increases the number of shares held by each shareholder. Bonus shares are issued in proportion to the existing shares a shareholder holds, maintaining their relative ownership in the company.

Which one is best for investor (Cash or bonus dividend)

The preference between cash dividends and bonus shares depends on the investor's financial goals and preferences.

Cash Dividends: Suitable for investors seeking regular income. It provides immediate cash returns that can be used for expenses or reinvested elsewhere.

Bonus Shares: Suited for investors looking to increase their ownership in the company without receiving immediate cash. It's a way to participate in the company's growth by acquiring more shares.
Ultimately, there's no universal "better" option; it depends on individual investment objectives and preferences. Some investors may prefer the liquidity of cash dividends, while others may appreciate the long-term benefits of bonus shares.

How to calculate dividend?

To calculate dividends, you need to know the dividend per share and the number of shares you own. The formula is:

Dividend Income
=Dividend per Share × Number of Shares
Dividend per share:
The dividend per share is calculated using the following formula:

Dividend per Share
=Total Dividends Paid/ Number of Outstanding Shares
Let's take example
If company proposed total dividends 4000000 and total outstanding shares of company is 100000 and you have 20 shares of that company then,
Dividend per share =Total Dividends Paid/ Number of Outstanding Shares
=400000/100000
=RS.4 per share
Now, dividend
=Dividend per Share × Number of Shares
=4 x 20
=80
Then you will get Rs.80 for 20 share.
Another formula
Let's take example, if company proposed 40% dividend to their shareholders,and you have 20 share 
Now,
Dividend amount=Number of share x ( Dividend percentage/100) x paid up value
= 20 x(40/100)x100
=Rs.800
Then you will get Rs.800 as a dividend.

Highest dividends paid company in Nepal 

1.Unilever Nepal Limited (1580 per share)
2. Ntc(40%)
3. Nabil Bank(11% but Nabil has good records in their previous years about more than 25% average)
4. NIC Asia(30%)
5.HDL etc (2079-80:25% but in previous years it has record of paying 100% dividend)
These are company pay high dividend but it may be different in different financial year. 
There are many more company who proposed high dividend in.

Disclaimer: Please invest your money with your own research and know your investment strategies. Market are subject to be risk. 




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