Vedanta, to REC, Coal India: 5 best dividend stocks to buy amid US-Iran war-led stock market volatility

Dividend Stocks to buy: The ongoing geopolitical situation has put immense pressure on risk assets, with Indian equity markets seeing sharp drawdowns since the dawn of the Iran war. This has shaken the certainty of capital gains, with investors now pivoting towards a classic ‘subscription’ to corporate profits, in the form of high dividend yields.

When business growth slows, the market’s appetite for risk vanishes, and that is where a demand for stable income becomes the need of the hour. Amid rising uncertainty of capital gains on equities in a volatile market, dividend-paying stocks are back in the limelight. Select companies, especially those with a mature business model and, therefore, having steady cash flows, tend to pay dividends regularly in a bid to return the excess cash generated from operations to shareholders.

Dividend refers to the portion of a company’s profits distributed to shareholders, usually in cash. Dividend yield, meanwhile, is the annual dividend paid by a company expressed as a percentage of its current share price. For investors, this becomes an important metric in uncertain markets because it indicates the return they can earn from payouts alone, irrespective of short-term stock price movements. Here are five stocks that have delivered the highest dividend yield.

Vedanta: The Anil Agarwal-led company, with a market capitalisation of over ₹2.6 lakh crore, has delivered the highest dividend yield of 6.3%, data showed. The Board of Directors of Vedanta on March 23 had approved the third interim dividend of ₹11 per equity share on a face value of Re 1 each for FY26, amounting to ₹4,300 crore.

Vedanta’s dividend record date has been fixed as March 28 to determine the eligibility of shareholders set to receive the dividend. In FY26 so far, Vedanta has announced dividends three times and declared a total dividend of ₹34 in the current financial year.

REC: With a market capitalisation of more than ₹87,000 crore, the stock has delivered a dividend yield of 5.98%. PSU power company REC Limited declared a fourth interim dividend of ₹3.20 per share and had set March 20 as the record date to determine the shareholders eligible for the payment. The payout is scheduled to be done on or before April 14.

It has declared a total dividend of ₹19.60 in the current financial year.

Coal India: The PSU major, with a market capitalisation of nearly ₹3 lakh crore, has offered a dividend yield of 5.7%. In FY26 so far, Coal India has announced dividends four times. It has declared a total dividend of ₹26.40 in the current financial year.

Hindustan Zinc: The company, with a market capitalisation of ₹2.2 lakh crore, has provided a dividend yield of 5.3%. In the last 12 months, the company distributed up to ₹10 dividend per share.

GAIL (India): With a market capitalisation of more than ₹94,000 crore, the stock has delivered a dividend yield of 5.1%. In the past 12 months, GAIL has declared an equity dividend amounting to ₹6 per share.

As volatility continues to dominate equity markets, dividend-paying stocks are once again emerging as a preferred pocket for investors seeking income visibility and relative stability. While capital appreciation may remain uncertain in the near term, these companies offer a cushion in the form of regular payouts, making them attractive in a risk-off environment.

Disclaimer: This story is for educational purposes only. Please consult with an investment advisor before making any investment decisions.