Best Dividend Stocks in India 2025

Top 20 Best Dividend Stocks in India 2025: Expert Picks by Lares Algotech

Best Dividend Stocks in India 2025 – Let’s explore India’s highest dividend-paying stocks based on yield, consistency, and long-term sustainability. This list includes both public and private sector players across different industries.

Coal India Ltd

• Dividend Yield: ~6.5%
• Sector: Mining
• Overview: A government-owned Maharatna, Coal India continues to be one of the best dividend stocks in India 2025, delivering strong payouts backed by massive profits from coal mining operations.

ITC Ltd

• Dividend Yield: ~5%
• Sector: FMCG & Tobacco
• Overview: ITC is known for its shareholder-friendly dividend policy. With a diversified portfolio from cigarettes to FMCG and hotels, it remains a stable pick.

Hindustan Zinc Ltd

• Dividend Yield: ~4.8%
• Sector: Metals
• Overview: A Vedanta subsidiary, Hindustan Zinc continues to impress with hefty payouts, making it one of the top dividend stocks in India 2025.

Vedanta Ltd

• Dividend Yield: ~9%
• Sector: Metals & Oil
• Overview: Known for returning significant profits to shareholders, Vedanta’s aggressive dividend policy remains attractive.

Power Finance Corporation (PFC)

• Dividend Yield: ~6%
• Sector: Financial Services
• Overview: As a major lender to the power sector, PFC’s strong earnings and government backing make it a reliable dividend payer.

Rural Electrification Corporation (REC)

• Dividend Yield: ~5.8%
• Sector: Finance
• Overview: REC finances power infrastructure across India and mirrors PFC’s strong dividend-paying legacy.

Indian Oil Corporation Ltd (IOCL)

• Dividend Yield: ~5.5%
• Sector: Oil & Gas
• Overview: IOCL, a PSU giant, consistently rewards shareholders with generous dividends.

Bharat Petroleum Corporation Ltd (BPCL)

• Dividend Yield: ~5.2%
• Sector: Oil Refining
• Overview: With a history of solid earnings, BPCL remains one of the best dividend stocks in India 2025 for PSU investors.

NTPC Ltd

• Dividend Yield: ~5%
• Sector: Power Generation
• Overview: India’s largest power utility company, NTPC, has a strong record of stable dividends and government support.

GAIL (India) Ltd

• Dividend Yield: ~4.5%
• Sector: Natural Gas
• Overview: GAIL’s monopoly in gas distribution supports its ability to return profits consistently.

Infosys Ltd

• Dividend Yield: ~2.8%
• Sector: IT
• Overview: Infosys is not only a tech giant but also a consistent dividend payer, backed by strong cash flows.

Tata Consultancy Services (TCS)

• Dividend Yield: ~3.5%
• Sector: IT
• Overview: With a near debt-free balance sheet and consistent profits, TCS ranks high among India’s best dividend-paying tech stocks.

HDFC Bank

• Dividend Yield: ~1.8%
• Sector: Banking
• Overview: Although it offers a lower yield, HDFC Bank’s stability and growth make it a good long-term dividend pick.

SBI (State Bank of India)

• Dividend Yield: ~3.7%
• Sector: Banking
• Overview: India’s largest public bank offers decent dividends along with growth prospects.

Bajaj Auto Ltd

• Dividend Yield: ~4%
• Sector: Automobile
• Overview: This two-wheeler major is known for maintaining a high payout ratio, offering strong returns to shareholders.

Hero MotoCorp Ltd

• Dividend Yield: ~3.8%
• Sector: Automobile
• Overview: A legacy dividend payer, Hero MotoCorp remains a favorite among income investors.

SJVN Ltd

• Dividend Yield: ~6.5%
• Sector: Hydropower
• Overview: A lesser-known gem, SJVN offers one of the highest yields among power PSUs.

Engineers India Ltd

• Dividend Yield: ~5.1%
• Sector: Engineering Services
• Overview: With consistent profits and a conservative business model, EIL ensures regular dividend income.

NALCO (National Aluminium Company Ltd)

• Dividend Yield: ~5.4%
• Sector: Metals
• Overview: NALCO’s earnings from aluminium and alumina exports contribute to its generous dividends.

Taparia Tools Ltd

• Dividend Yield: ~220% (Exceptional case)
• Sector: Tools Manufacturing
• Overview: A rare case of super-high dividend yield, Taparia Tools surprised markets with enormous returns, although sustainability should be assessed.

💹 How to Choose the Best Dividend Stocks in India 2025?

Not all high-yield stocks are great investments. Look at:

• Dividend Consistency: Choose companies with at least 5 years of steady payouts.
• Payout Ratio: A moderate payout ratio (30–70%) ensures sustainability.
• Earnings Growth: Rising earnings support future dividends.
• Low Debt: Less debt equals fewer liabilities and better dividend reliability.
• Sector Health: Choose stocks from stable or growing sectors.

🔍 Sectors Dominating Dividend Payouts in 2025

Certain industries are consistently featured among the best dividend stocks in India 2025:

• Public Sector Units (PSUs): Backed by the government, PSUs like Coal India, NTPC, and IOCL continue to lead.
• IT Giants: TCS and Infosys use their cash reserves wisely to pay dividends.
• Banks & NBFCs: Stable performers like HDFC Bank, SBI, PFC.
• Metal & Mining: Vedanta, Hindustan Zinc, and NALCO remain attractive for dividend hunters.

🧠 Conclusion: Are Dividend Stocks Worth It in 2025?

Absolutely. As market volatility increases and investors seek predictable returns, the best dividend stocks in India 2025 offer both peace of mind and a growing source of income. Whether you are a retiree, a long-term investor, or someone building a passive income stream, high-quality dividend stocks should be part of your portfolio.

However, don’t just chase yield—look at fundamentals, history, sector prospects, and management quality. For most investors, a balanced mix of growth and dividend stocks creates a robust portfolio.

🗂️ Summary Table: Best Dividend Stocks in India 2025

Coal India Ltd

Coal India Ltd is undoubtedly one of the best dividend stocks in India 2025. As the world’s largest coal-producing company, it commands over 80% of India’s coal output. Being a public sector undertaking (PSU), Coal India is known for rewarding shareholders generously with annual dividends. In FY 2024–25, it delivered a yield of over 6.5%, reflecting robust profitability and government mandates for dividend distribution. The company’s strategic importance in India’s energy security, coupled with consistent cash flows, supports its high dividend payouts. For investors looking for steady income and a government-backed balance sheet, Coal India stands out as a reliable option.

ITC Ltd

ITC Ltd is one of the most consistent players among the best dividend stocks in India 2025. Operating across FMCG, hotels, paperboards, and agribusiness, ITC has built a resilient revenue model. Its dominant position in the tobacco segment ensures strong profit margins, allowing the company to maintain a high payout ratio. In FY 2025, ITC maintained a dividend yield of around 5%, attracting conservative investors seeking dependable income. With a debt-free balance sheet and continuous expansion in non-tobacco businesses, ITC remains a balanced choice for both income and growth-oriented portfolios.

Hindustan Zinc Ltd

A subsidiary of Vedanta Ltd, Hindustan Zinc has earned its spot among the best dividend stocks in India 2025 thanks to its significant earnings and regular payouts. It is the largest zinc producer in India and among the top globally. The company benefits from high commodity prices and strong operational efficiencies. Hindustan Zinc’s dividend yield remains close to 5%, backed by steady demand for zinc, lead, and silver. Despite being in a cyclical industry, its strong cash reserves and low debt enable generous dividends year after year.

Vedanta Ltd

Vedanta Ltd is a standout among the best dividend stocks in India 2025 with an exceptionally high dividend yield, often surpassing 8-9%. With a diversified portfolio spanning aluminum, zinc, copper, and oil & gas, Vedanta benefits from high global commodity demand. Despite periodic debt concerns, the company has consistently prioritized shareholders, making it a go-to stock for high-income seekers. Vedanta’s aggressive dividend policy is both a reward mechanism and a value-unlocking strategy for long-term investors.

Power Finance Corporation (PFC)

Power Finance Corporation is a Navratna PSU under the Ministry of Power and a top name among the best dividend stocks in India 2025. It provides funding for electricity infrastructure, ensuring stable cash flows and earnings. In FY 2025, PFC declared a dividend yield exceeding 6%, underlining its shareholder-friendly approach. With India’s push for electrification and green energy, PFC’s loan book is expanding rapidly, securing its position as a high-yield income stock.

Rural Electrification Corporation (REC)

REC Ltd complements PFC’s role in financing India’s power needs and ranks high among the best dividend stocks in India 2025. This government enterprise funds rural electrification and transmission projects. In 2025, REC offered a dividend yield close to 5.8%. Its earnings are secured through interest income from long-term government-backed projects, making its dividends predictable and sustainable. REC is ideal for investors seeking stable income from a low-volatility stock.

Indian Oil Corporation Ltd (IOCL)

IOCL is India’s flagship oil refining and marketing company. As one of the largest PSUs, it’s a consistent feature among the best dividend stocks in India 2025. It operates across the oil and gas value chain, including refining, pipeline transportation, and fuel retailing. With its strong earnings and government ownership, IOCL declared a dividend yield of over 5.5% in FY 2025. The company benefits from fuel price de-regulation and diversified energy projects, supporting its long-term dividend strategy.

Bharat Petroleum Corporation Ltd (BPCL)

BPCL, another major public sector oil refiner, continues to be one of the best dividend stocks in India 2025. Known for its consistent profitability and strong retail footprint, BPCL delivered a dividend yield exceeding 5.2% in 2025. Its strong refining margins and marketing business ensure stable earnings, which translates into healthy dividends. The government’s partial disinvestment plan has also attracted attention, potentially unlocking further value for shareholders.

NTPC Ltd

NTPC is India’s largest power generation company and a highly reliable pick among the best dividend stocks in India 2025. It contributes over 20% of India’s electricity generation and is expanding into renewable energy. In FY 2025, NTPC offered a dividend yield of about 5%. Its regulated business model ensures predictable cash flows, making dividend payouts consistent. With a growing renewable portfolio and modernization of plants, NTPC promises stable returns for the long haul.

GAIL (India) Ltd

GAIL is the largest natural gas processing and distribution company in India. It holds a monopoly in several pipeline networks and commands stable revenues. As one of the best dividend stocks in India 2025, GAIL has offered consistent yields of around 4.5%. The company is expanding into LNG imports and petrochemicals, diversifying its income streams. GAIL’s government backing and monopoly status ensure that it remains a steady dividend payer.

Infosys Ltd

Infosys Ltd stands tall among the best dividend stocks in India 2025 in the IT services sector. A global player in consulting, digital services, and outsourcing, Infosys has maintained a robust dividend track record. With a dividend yield of around 2.8%, it offers a reliable income stream alongside impressive capital appreciation. The company has zero debt, high free cash flow, and a strong client base across North America and Europe. Infosys is especially appealing to investors seeking stable income from a large-cap technology company with a clean governance structure. Regular buybacks and special dividends further boost shareholder returns.

Tata Consultancy Services (TCS)

TCS, India’s largest IT services firm by market capitalization, is a favorite among dividend investors. As one of the best dividend stocks in India 2025, TCS boasts a consistent payout policy, often distributing over 80% of net profits through dividends and buybacks. With a dividend yield of approximately 3.5%, TCS offers both income and stability. The company’s client diversification, steady deal wins, and high margins ensure ongoing cash generation. Its alignment with global digital transformation trends adds further security for long-term investors. For those seeking a blue-chip with recurring income, TCS is a must-have.

HDFC Bank

HDFC Bank is the largest private sector bank in India and remains one of the best dividend stocks in India 2025 despite offering a modest yield (~1.8%). Its consistency, low NPAs, and strong financial ratios make it a dependable choice for both income and capital growth. The bank has increased its dividend payout steadily over the past few years, reflecting improved profitability post its merger with HDFC Ltd. HDFC Bank’s strong brand reputation, nationwide presence, and customer-centric digital offerings enhance its earnings visibility, ensuring sustainable dividend growth in the years ahead.

State Bank of India (SBI)

SBI, the country’s largest lender by assets, is a strong pick among the best dividend stocks in India 2025. Offering a dividend yield of approximately 3.7%, the bank appeals to those seeking exposure to the banking sector with stable returns. Backed by the government, SBI has weathered past asset quality issues and emerged with improved performance across retail and corporate banking. It is also expanding into wealth management and digital platforms. With its dominant market share and rising profitability, SBI is likely to sustain and increase its dividend payouts going forward.

Bajaj Auto Ltd

Bajaj Auto is a consistent dividend payer in the Indian automobile space and stands out among the best dividend stocks in India 2025. Known for its robust operating margins and minimal debt, Bajaj Auto maintains a payout ratio of over 80%. In FY 2025, its dividend yield exceeded 4%. The company has a strong presence in both domestic and export two-wheeler markets, especially with its premium brand portfolio. Its healthy cash reserves and efficiency-driven operations make it an excellent long-term pick for dividend-focused investors.

Hero MotoCorp Ltd

Hero MotoCorp, the world’s largest manufacturer of two-wheelers, maintains a legacy of strong dividend payouts. Ranking high among the best dividend stocks in India 2025, Hero offers a dividend yield of around 3.8%. The company’s wide distribution network and brand loyalty ensure consistent earnings. Even amidst EV transitions, Hero is investing in future mobility while maintaining high returns to shareholders. Its robust balance sheet, strong cash flows, and consistent profitability make it a dependable stock for conservative dividend seekers.

SJVN Ltd

SJVN Ltd, a mini-ratna PSU operating in hydropower, is a hidden gem among the best dividend stocks in India 2025. The company offers a dividend yield of over 6.5% and has a strong project pipeline across hydro, solar, and wind segments. Its regulated tariff model ensures stable cash flows. With increasing focus on renewable energy, SJVN is well-positioned to grow while maintaining high dividend payouts. Backed by the government and with no major debt concerns, it’s ideal for investors looking for safe and high-yielding options.

Engineers India Ltd (EIL)

Engineers India Ltd is a government-owned engineering consultancy firm specializing in the hydrocarbons and infrastructure sectors. Among the best dividend stocks in India 2025, EIL offers a yield of around 5.1%. It maintains a strong order book and asset-light business model, leading to consistent profitability and surplus cash. EIL’s long-standing client base includes giants like IOCL, BPCL, and ONGC. With minimal capital expenditure requirements, the company returns a large share of profits as dividends, making it a great option for yield-focused investors.

NALCO (National Aluminium Company Ltd)

NALCO is a Navratna PSU and one of India’s largest integrated aluminium producers. It has consistently featured among the best dividend stocks in India 2025. Offering a dividend yield of 5.4%, NALCO benefits from global commodity prices and robust export performance. The company has integrated operations from bauxite mining to finished aluminium products, ensuring cost efficiency. It maintains a clean balance sheet with negligible debt. With ongoing expansions and strong cash flows, NALCO is expected to continue rewarding shareholders generously.

Taparia Tools Ltd

Taparia Tools Ltd, a lesser-known but high-yielding stock, surprised many with its whopping dividend yield of over 200% in FY 2025. This places it at the extreme top of the best dividend stocks in India 2025 list, albeit with some caution. A small-cap firm manufacturing hand tools, Taparia Tools has limited volatility and a niche market. However, such high yields may not be sustainable year after year and require close monitoring. While the dividend payout is remarkable, investors should evaluate the consistency and underlying business strength before making long-term bets.

requently Asked Questions About Dividend Investing in India 2025

🏆 Which are the top dividend yield stocks in India right now?

As of 2025, several companies are leading the charts when it comes to dividend yields in India. Among the best dividend stocks in India 2025, names like Coal India Ltd, Vedanta Ltd, Hindustan Zinc, and ITC Ltd stand out. These companies offer attractive dividend yields ranging from 5% to as high as 9%, making them highly appealing to income-focused investors. Public sector undertakings (PSUs) such as NTPC, IOCL, and Power Finance Corporation (PFC) also feature prominently due to their stable cash flows and government-mandated dividend distribution practices.

In addition to these, private sector leaders like Infosys, TCS, Bajaj Auto, and Hero MotoCorp consistently reward shareholders through steady and sometimes even growing dividend payouts. These companies combine strong fundamentals, high profitability, and sound corporate governance, which support their long-term dividend strategies. For investors looking to build a portfolio with reliable passive income and capital preservation, these stocks represent some of the best dividend stocks in India 2025. However, it’s crucial to evaluate dividend sustainability along with yield, as not all high-yield stocks are necessarily safe bets. A holistic approach considering earnings, payout ratio, and business stability is essential before making investment decisions.

📊 What is the dividend yield of a company and how is it calculated?

Dividend yield is a financial metric that measures the annual dividend income you receive from a stock as a percentage of its current market price. It helps investors compare income potential across various stocks and sectors. The formula to calculate dividend yield is:

Dividend Yield = (Annual Dividend per Share / Current Market Price per Share) × 100

For example, if a company pays ₹20 per share annually and its stock trades at ₹400, the dividend yield is 5%. Investors looking for consistent income often prioritize stocks with higher dividend yields.

The best dividend stocks in India 2025 typically offer yields between 4% to 9%, and in some unique cases, even higher. However, a high yield alone doesn’t make a stock a good investment. One must analyze whether the dividend is sustainable based on the company’s cash flows and earnings. Companies with consistent earnings, low debt, and good cash reserves are better positioned to maintain or increase their dividends. Understanding dividend yield is crucial for income investors aiming to generate passive income and beat inflation over time.

🏢 What kind of companies pay high dividends?

High-dividend-paying companies typically share a few common characteristics: consistent profitability, strong cash flows, low capital expenditure needs, and a mature business model. Industries such as utilities, oil and gas, mining, financial services, FMCG, and information technology often top the list of dividend payers. These sectors generally generate stable earnings and have limited reinvestment requirements, allowing them to distribute a significant portion of profits to shareholders.

For example, among the best dividend stocks in India 2025, companies like Coal India, Hindustan Zinc, ITC, and PFC maintain high dividend yields because of their strong operating performance and commitment to shareholder returns. Many PSUs (public sector undertakings) are also top dividend contributors due to government policy that mandates regular and substantial dividend payouts.

Large-cap private players like TCS, Infosys, and Bajaj Auto also maintain generous dividend policies. These firms have predictable revenue streams, are cash-rich, and have little to no debt. Such companies are ideal for conservative investors looking for steady income. However, it’s essential to assess whether a company’s dividend payout is sustainable in the long run by analyzing payout ratios, earnings history, and sector health. Not all high-dividend companies offer quality investments.

❓ Is every high dividend yield company a good buy?

No, not every high dividend yield company is a good buy. A high dividend yield might look attractive at first glance, but it can also be a red flag. Sometimes, yields are elevated because the stock price has dropped significantly due to poor earnings, declining growth prospects, or financial instability. It’s important to look beyond the yield and analyze the company’s fundamentals before investing.

Among the best dividend stocks in India 2025, companies like Coal India, Vedanta, ITC, and Infosys not only offer attractive yields but also maintain strong financial health, consistent earnings, and sustainable payout ratios. These are signs of reliable dividend-paying stocks. On the contrary, some lesser-known or distressed companies may offer extremely high yields, but those dividends may be unsustainable or at risk of being cut.

Smart investors should evaluate the dividend payout ratio, free cash flow, earnings consistency, debt levels, and overall business model. A stock with a 10% yield but uncertain future is riskier than one with a stable 4% yield backed by strong fundamentals. Therefore, while high yield can be a bonus, quality, sustainability, and stability are what truly define the best dividend stocks in India 2025.

Ready to start dividend investing? Bookmark this list of the best dividend stocks in India 2025 and revisit it before your next portfolio update!