Top 10 Highest Dividend Yield Stocks in India

Top 10 Highest Dividend Yield Stocks in India

Investing in dividend-paying stocks has always been one of the most reliable ways for investors to create steady cash flow and build long-term wealth. With India’s rapidly growing economy and stronger corporate earnings, dividend yield stocks are gaining massive attention. By 2026, several companies are expected to offer attractive dividend payouts, making them lucrative opportunities for both income-seeking investors and long-term wealth builders. In this article, we will explore the Top 10 Highest Dividend Yield Stocks in India, providing insights into their performance, sector potential, dividend history, and why they are worth considering for your investment portfolio.

What is Dividend Yield and Why Does It Matter?

The dividend yield is a key metric that measures the annual dividend paid per share in relation to the stock price. A higher dividend yield indicates that investors receive more return in the form of cash dividends. For income-oriented investors, especially retirees or those seeking passive income, dividend-paying stocks are a vital part of wealth planning.

Companies with strong fundamentals and consistent profits often share their success with shareholders through high dividend payouts. 

Formula:

formula divende yield stock

 

 

For example, if a stock priced at ₹200 pays ₹20 as a dividend, the dividend yield is 10%.

Why Invest in High Dividend Yield Stocks?

  1. Regular Passive Income – These stocks work like fixed deposits but with better returns. 
  2. Protection Against Market Volatility – Even if share prices fluctuate, dividends provide stability.
  3. Wealth Building – Reinvesting dividends compounds wealth faster than you think.

Key Factors to Consider Before Investing in Dividend Yield Stocks

Before jumping in, remember that a high dividend yield doesn’t always mean a great stock. Check:

  • Payout Ratio – A very high payout ratio may not be sustainable. 
  • Company Fundamentals – Strong profits and cash flow ensure consistent payouts. 
  • Industry Stability – Energy, power, and utilities are traditionally safe dividend payers. 
  • Growth Potential – The company should balance dividends with future growth. 
  • Sector Growth Potential: Sectors like energy, oil, and power provide stable long-term demand. 
  • Government Policy Impact: PSU stocks often have high dividend payouts, but they may be influenced by policy changes. 
  • Market Volatility: High dividend yield stocks may offer stability, but investors should also assess overall market risks. 

Top 10 Highest Dividend Yield Stocks in India 

Here are the top picks expected to give the highest dividend yields: 

1. Coal India Limited (CIL)

Coal India has long been one of the highest dividend-paying companies in India. Being a public sector enterprise and the largest coal producer in the world, Coal India maintains a strong cash flow.

  • Industry: Energy & Mining 
  • Dividend Yield (2026 est.): 9–11% 
  • Why Invest: With growing energy demands and government reliance on coal, the company continues to generate robust earnings, allowing it to distribute significant dividends. 

2. Hindustan Zinc Limited (HZL)

Hindustan Zinc, a subsidiary of Vedanta Group, has been consistently paying out large dividends due to its strong profitability in the metal and mining sector.

  • Industry: Metals & Mining 
  • Dividend Yield (2026 est.): 8–10% 
  • Why Invest: With global demand for zinc and silver rising, HZL’s revenue and cash flow remain strong, ensuring continued generous dividends. 

3. Indian Oil Corporation (IOC)

Indian Oil Corporation is another public sector giant known for rewarding shareholders through regular dividends. Its extensive market dominance in oil refining and distribution keeps its revenue stable.

  • Industry: Oil & Gas 
  • Dividend Yield (2026 est.): 7–9% 
  • Why Invest: IOC benefits from strong government backing, stable earnings, and robust infrastructure. With increasing fuel consumption, dividend payouts are expected to remain high. 

4. NTPC Limited

NTPC is India’s largest power generation company. Its steady revenue model and government ownership make it a reliable dividend-paying stock.

  • Industry: Power Generation 
  • Dividend Yield (2026 est.): 6–7.5% 
  • Why Invest: The increasing demand for electricity and NTPC’s expansion into renewable energy ensures sustainable profits and steady dividend payouts. 

5. Vedanta Limited

Vedanta is one of the most consistent high-dividend-paying companies in India, thanks to its diversified operations in oil, gas, zinc, aluminum, and other resources.

  • Industry: Diversified Natural Resources 
  • Dividend Yield (2026 est.): 10–12% 
  • Why Invest: Vedanta’s strong presence in multiple commodities and aggressive shareholder reward policies make it a top pick for dividend investors. 

6. Power Grid Corporation of India (PGCIL)

Power Grid is a leader in India’s electricity transmission sector. Being a monopoly player in power transmission, the company enjoys consistent cash inflows and stable earnings.

  • Industry: Power Transmission 
  • Dividend Yield (2026 est.): 6–8% 
  • Why Invest: As India continues expanding its electricity infrastructure, Power Grid will maintain stable dividends, making it a defensive yet income-generating stock.

7. Oil and Natural Gas Corporation (ONGC)

ONGC is India’s largest oil and natural gas producer, with a long history of paying high dividends to shareholders.

  • Industry: Oil & Natural Gas 
  • Dividend Yield (2026 est.): 7–9% 
  • Why Invest: Global crude oil demand remains strong, and ONGC continues to benefit from high commodity prices, ensuring steady dividend payouts. 

8. REC Limited (Rural Electrification Corporation)

REC is a government-owned finance company that funds power sector projects across India. Its strong financials have helped it maintain a track record of consistent dividend payments.

  • Industry: Financial Services (Power Financing) 
  • Dividend Yield (2026 est.): 7–8% 
  • Why Invest: With India investing heavily in power infrastructure, REC is set to grow and keep rewarding investors with high dividend yields. 

9. GAIL (India) Limited

GAIL is India’s largest natural gas company, engaged in transmission, distribution, and processing of natural gas.

  • Industry: Natural Gas 
  • Dividend Yield (2026 est.): 6–7% 
  • Why Invest: With a push towards clean energy, natural gas consumption is set to rise, strengthening GAIL’s profitability and ensuring sustainable dividends.

10. Bharat Petroleum Corporation Limited (BPCL)

BPCL is another oil refining and marketing company that pays out attractive dividends. It is also one of the key players in India’s energy sector.

  • Industry: Oil & Gas 
  • Dividend Yield (2026 est.): 6–8% 
  • Why Invest: BPCL’s strong refining margins and government stake make it a secure dividend-paying investment option. 

Risks of Investing in Dividend Yield Stocks

  • Dividend Cuts – If profits drop, dividends may be reduced. 
  • Industry Dependence – Most high dividend stocks are in energy and oil & gas. 
  • Regulatory Risks – Government policy changes may affect payouts. 

Best Strategy to Invest in High Dividend Yield Stocks

  • Diversify Across Sectors – Don’t put all eggs in one basket. 
  • Reinvest Dividends – Compounding works like magic over time. 
  • Balance with Growth Stocks – High dividend stocks are stable, but growth stocks ensure wealth creation.

 

Final Thoughts on High Dividend Stocks in India 

Dividend yield stocks are perfect for investors seeking regular income and stability . With companies like Coal India, Hindustan Zinc, and PFC offering some of the highest dividend yields in India, investors can build a strong income-focused portfolio. But remember, don’t blindly chase yield—always check fundamentals and long-term sustainability.

FAQs

Which stock has the highest dividend yield in India 2026?
Hindustan Zinc is expected to lead with a double-digit dividend yield.

Are dividend yield stocks safe for beginners?
Yes, they are relatively safe, but beginners should diversify across sectors.

How often are dividends paid in India?
Most companies pay dividends annually or semi-annually, some quarterly.

Should I focus only on dividend yield?
No, balance dividend yield with growth potential for better returns.

Can dividend stocks beat inflation?
Yes, high-yield stocks with strong fundamentals often beat inflation over the long term.

Disclaimer: Investing in the stock market comes with risks. Please read all related documents carefully before investing. The information in this article is only for learning purposes and should not be taken as financial advice. Trading in derivatives like options carries high risk and may not be suitable for everyone. Past results do not guarantee future returns. Always consult a financial advisor before making any investment or trading decisions.

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