Dividends are a key factor for investors looking to generate passive income from their stock investments. A dividend is a portion of a company's profits distributed to shareholders, typically on a quarterly or annual basis. Companies with high dividend yields provide consistent cash flow, making them attractive for investors seeking steady returns alongside potential capital appreciation.
While large-cap companies are known for stable dividends, several small-cap stocks also offer impressive yields while maintaining strong financial growth. Investing in high dividend-yielding small-cap stocks can provide a unique opportunity to earn regular income while benefiting from the growth potential of emerging companies.
1. Balmer Lawrie & Company Ltd (Dividend Yield: 5.41%)
Balmer Lawrie is a diversified PSU operating across multiple industries, including industrial packaging, lubricants, logistics, chemicals, and travel services. With consistent revenue growth of 15.1% over the last three years, this company provides stability along with a generous dividend yield.
2. GTPL Hathway Ltd (Dividend Yield: 3.76%)
GTPL Hathway is India’s largest Multi-System Operator (MSO) in Digital Cable TV and a leading private broadband provider. With a steady sales growth rate of 9.2% and a return on capital employed (ROCE) of 12%, it offers both stability and income for investors.
3. Monte Carlo Fashions Ltd (Dividend Yield: 3.53%)
Monte Carlo is a well-known brand in the designer woolen and cotton apparel industry. The company's 19.5% sales growth over the past three years and strong market presence make it an attractive dividend-yielding small-cap stock.
4. JK Paper Ltd (Dividend Yield: 3.02%)
JK Paper is a leading manufacturer of office papers, coated papers, and packaging boards. With an impressive 34.3% revenue growth over three years and a 20.3% ROCE, it remains a solid choice for investors seeking dividend income and capital appreciation.
5. Expleo Solutions Ltd (Dividend Yield: 5.25%)
Expleo Solutions specializes in software validation and verification services for the BFSI industry worldwide. The company’s 47.5% sales growth over three years and 20.5% ROCE reflect strong business fundamentals. Its high dividend yield of 5.25% makes it an attractive choice.
6. Veedol Corporation Ltd (Dividend Yield: 3.48%)
Veedol manufactures a wide range of automotive lubricants for various vehicles, including OEM oils, transmission oils, and greases. With a 23.7% ROCE and 15.3% sales growth, the company is positioned well in the lubricants market, offering stable dividends.
7. Bhansali Engineering Polymers Ltd (Dividend Yield: 3.84%)
Bhansali Engineering is a key player in ABS, AES, and SAN resins manufacturing. With a 24.4% ROCE and an 8.39 EV/EBITDA, the company offers a good balance of value and income for investors.
8. D B Corp Ltd (Dividend Yield: 5.96%)
D B Corp is one of India’s largest media and publishing houses, operating in newspapers, radio, and digital services. The company’s 25.1% ROCE, steady revenue growth of 16.8%, and a solid dividend yield of 5.96% make it an excellent income-generating small-cap stock.
9. Alldigi Tech Ltd (Dividend Yield: 4.76%)
Alldigi Tech offers business process outsourcing (BPO) services, including data verification, telemarketing, customer service, and HR processing. With a 30.5% ROCE and 19.3% sales growth, the company delivers both high dividends and growth potential.
10. Styrenix Performance Materials Ltd (Dividend Yield: 4.12%)
Styrenix Performance Materials is engaged in engineering thermoplastics manufacturing. Its 31.4% ROCE and stable business operations ensure that it remains a promising dividend stock.
These high-dividend-yield small-cap stocks offer a combination of stable income and long-term growth. Investors should consider their risk appetite, market conditions, and financial goals before investing.
Disclaimer
The information provided in this article is for educational and informational purposes only. It should not be considered as investment advice, stock recommendations, or financial planning guidance. Investors are advised to conduct their own research or consult a certified financial advisor before making any investment decisions. The stock market is subject to market risks, and past performance does not guarantee future returns.
