Dividend Watch: 7 Power Stocks Going Ex-Dividend Next Week—Avoid These Yield Traps!

Heads up, investors: Eight major Indian stocks trade ex-dividend next week. Hindustan Unilever (June 23) offers stable 1.85% yield from its ₹24/share payout, reflecting its FMCG dominance. Vedanta (June 24) tempts with a sky-high 9.72% yield (₹7/share), but its debt and commodity volatility make this risky. HDFC Bank (June 27) delivers reliable 1.14% yield (₹22/share), ideal for balanced portfolios. Swaraj Engines (June 27) shines with 2.63% yield (₹104.50/share), boosted by farm equipment demand.  

Remember: High yields like Vedanta’s often signal underlying risks, while steadier payers (HUL, HDFC) prioritize sustainability. Always buy before the ex-date to qualify, and weigh dividends against growth potential—Cipla (0.87%) and Bajaj Holdings (0.68%) offer stronger appreciation prospects. Balance income with long-term stability. 

Dividend Watch: 7 Power Stocks Going Ex-Dividend Next Week—Avoid These Yield Traps!

Strategic Insights for Savvy Investors  

As we approach late June 2025, several prominent Indian companies are set to trade ex-dividend. While dividend announcements often grab headlines, understanding the story behind the numbers is crucial. Below, we break down these opportunities with context on sustainability, yield traps, and strategic fit.  

Quick Reference: Ex-Dividend Dates & Key Metrics 

Deep Dive: 3 Standout Opportunities & Caveats 

• Hindustan Unilever (HUL):  

• The Safe Haven: India’s FMCG giant offers stability with its 2,400% dividend. Though the yield (1.85%) seems modest, HUL’s 90% household penetration and brands like Dove and Surf Excel signal recession-resistant cash flows. Ideal for conservative portfolios. 

• Vedanta – High Yield, High Risk:  

• The Double-Edged Sword: Vedanta’s staggering 9.72% yield is eye-catching, but investors should tread carefully. The company’s debt-heavy balance sheet and volatile commodity prices (zinc, oil, copper) make this dividend potentially unsustainable. Historically, such high yields often precede cuts. 

• Swaraj Engines – The Under-the-Radar Performer:  

• Leveraging Farm Economy Strength: A 1,045% dividend payout reflects robust demand for Mahindra-linked tractors. With a healthy 2.63% yield and exposure to India’s agri-mechanization trend, this is a niche play. Watch monsoon patterns for future cues. 

Strategic Considerations for Dividend Investors 

• Record Date vs. Holding Period: To qualify for dividends, you must own shares before the ex-date. Last-minute buying often inflates prices temporarily—sell-offs typically follow ex-dates.  

• Yield Isn’t Everything: Cipla (0.87%) and HDFC Bank (1.14%) offer lower yields but stronger growth potential. Dividends here supplement long-term capital appreciation.  

• Special Situations: Bajaj Holdings (0.68% yield) acts as a proxy for Bajaj Auto/Finserv. Its dividends depend on portfolio performance—useful for indirect exposure to India’s auto-finance boom. 

The Bigger Picture: Dividends in Today’s Market 

While dividends provide passive income, prioritize companies with:  

• Strong Free Cash Flow (e.g., HUL, HDFC Bank).  

• Moderate Payout Ratios (avoid Vedanta’s 700% if debt concerns persist).  

• Sector Tailwinds (e.g., Swaraj Engines in agri-infrastructure). 

Remember: High dividends can signal stagnation (Alkyl Amines, Kalpataru) if not backed by earnings growth. Balance yield with quality.