Small cap infra stock declares dividend of ₹15, trading at a yield of 3.87%

With a market valuation of ₹3,483.96 Cr, Nirlon Ltd. is a small-cap company that engages in the infrastructure industry. The Nirlon Knowledge Park (NKP) in Goregaon (East), Mumbai, is an industrial park and information technology park that is being developed and managed by the company. The firm has announced its Q3 earnings as well as a dividend for eligible shareholders of ₹15 per share, bringing the dividend yield to 3.87%.

The company has said in a stock exchange filing that the Board of Directors “have, interalia, considered and approved the interim dividend of Rs.15/-per equity share of Rs. 10/- each (@150%) for the F.Y. 2022-2023, subject to deduction of tax at source, which will be made on or after Friday, February 24, 2023, to the Members as under: i. To all Beneficial Owners in respect of shares held in Dematerialized Form as per the data as may be made available by National Security Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL) as of the close of business hours on Friday, February 17, 2023; ii. To all Members in respect of shares held in Physical Form after giving effect to valid transmission and/or transposition requests lodged with the Company as on the close of business hours on Friday, February 17, 2023.”

During Q3FY23, the company reported net sales of ₹143.72 crore compared to Rs. 92.55 crore in Q3FY22, representing a growth of 55.30%. The company's EBITDA reached ₹118.6 crore in the quarter ended December 2022 compared to ₹74.5 crore in the year-ago quarter, representing a YoY growth of 59.2%, whereas the EBITDA margins stood at 82.19% in Q3FY23 compared to 80.19% in Q3FY22. 

The company's net profit reached ₹53.5 crore in Q3FY23 compared to ₹13.5 crore in Q3FY22, representing a YoY growth of 297%. The EPS of Nirlon stood at ₹5.94 in Q3FY23 up from ₹1.49 in the year-ago quarter. The company's total secured debt facility authorised by HSBC as of December 31, 2022, including an OD facility, was INR 1,230 Cr. Nirlon’s debt outstanding as on 31 December 2022 from HSBC Bank was INR 1,150 Cr and CRISIL has assigned ‘CRISILAA+/Stable’ rating to this facility.

The shares of Nirlon Ltd closed today on the BSE at ₹386.60 apiece, up by 0.40% from the previous close of ₹385.05. Considering the dividend announced, the stock at the current market price is trading at a dividend yield of 3.87%. Nirlon has announced a 260.00% equity dividend, or Rs. 26 per share, for the fiscal year that ended in March 2022. This generates a dividend yield of 6.73% at the current share price of ₹386.60.