Indian stocks are the least attractive in terms of dividend returns in Asia, Refinitiv data shows, which could prompt some investors to shy away from the country’s equity markets.
India’s large and mid-cap stocks’ forward dividend yield ratio stood at 1.7 percent on Tuesday, the lowest in Asia, according to the data.
Australian stocks led the dividend yields in the region with a ratio of 4.68 percent, followed by Singapore’s 4.25 percent. Asia’s average ratio was 2.7 percent.
India’s NSE index was up nearly 5 percent this year as of Monday’s close, behind the MSCI Asia-ex-Japan index’s rise of 6.7 percent.
Foreign investors have shunned Indian stocks over the past few months as the economy has shown signs of weakening due to falling demand for consumer goods, such as automobiles, and lower government spending.
Over the past three months, foreigners have sold $3.2 billion worth of Indian stocks, data from the stock exchange showed.
Indian firms are offering lower dividends at a time when global investors are scouring markets for higher-yielding assets, with most of the developed world bond markets offering lower or negative returns.
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Updated Date: Oct 15, 2019 14:39:30 IST