The earnings season is underway on D-Street, with numerous firms revealing their financial performances for the quarter and year ending March 31, 2025. In addition to these results, dividend declarations from reliable dividend-paying companies are captivating investors’ interest.

Small-Cap Company Making Waves

Among these notable announcements, one small-cap company stands out for its unwavering commitment to delivering dividends. With an appealing dividend yield of 2.30%, this firm has consistently issued dividends each year since 2008.

Swaraj Engines Ltd: A Dividend Champion

The company in focus is Swaraj Engines Ltd (SEL), which specializes in manufacturing diesel engines for the "Swaraj" tractors produced by Mahindra and Mahindra (M&M). SEL provides engines ranging from 20 HP to 65 HP and has been operational since 1989-90, successfully supplying 1.59 million engines to Swaraj Tractors.

Recently, SEL released its financial results for Q4 FY25, showcasing a record-high dividend of Rs 104.50 per share for the fiscal year ending March 31, 2025.

Impressive Financial Growth

In its latest earnings report, SEL demonstrated robust growth:

• Net profits surged by 29% year-on-year, reaching Rs 45.4 crore for Q4 FY25.
• Revenue also climbed by 29.4% year-on-year to Rs 454 crore.
• EBITDA rose to Rs 61.9 crore, reflecting a 28.7% increase from the previous year.

One significant aspect of SEL’s success is its relationship with Mahindra and Mahindra, which holds 52.12% of the company’s shares, translating to 63.31 lakh shares. This exceptional dividend payout will result in M&M receiving approximately Rs 66.16 crore.

Key Dates for Shareholders

The record date to determine eligible shareholders for the dividend has been set for Friday, June 27, 2025, pending approval from the company. The Annual General Meeting (AGM) is scheduled for Tuesday, July 15, 2025.

Expansion Plans and Future Growth

Beyond the dividend announcement, SEL has also revealed plans for significant expansion in engine capacity. The company aims to boost production from the current 195,000 units to 240,000 units annually to cater to increasing demand. This ambitious expansion project is estimated to cost Rs 220 crore, which will be financed entirely through internal resources and surplus funds.

Remarkable Stock Performance

As a small-cap stock, SEL has consistently delivered impressive returns over the years. In the last three years, its stock has soared by an astonishing 190.16%. Over the past year, the shares have risen by 70.78%, and they are up by 40.11% year-to-date.

Conclusion

Investors should note that this article serves informational purposes only and does not constitute investment advice. Before making any financial decisions, it is essential to consult with independent advisors tailored to individual investment goals and resources.

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