Despite marginal increase in profits, corporates have been fairly generous and declared hefty interim dividends in the first five months of 2010-11. Between Aprl-August 2010, 71 companies have informed the stock exchanges their intention of rewarding shareholders with interim dividends. And so far, India Inc has paid Rs 2,971 crore as interim dividend. Some companies have announced interim dividends despite fall in net profit or widening losses.

However, during April-August 2009, only 59 companies had declared interim dividend and the corporates had paid Rs 2,080 crore. CNI Research CMD Kishor P Ostwal said, ?Interim dividends are given when business prospects improve and this year that has happened prompting companies to be generous.?

The IT sector is at the forefront with 12 companies declaring interim dividend for 2010-11 so far. Four major companies in IT space?TCS, HCL Technologies, HCL Infosystems and Patni Computers?have declared interim dividend of 50 to 3150%. SMC Capital CEO & head of equity, Jagannadhan Thunuguntla said, ?Higher dividends indicate the confidence of the corporates and signal that they want to be shareholder friendly. To maintain the dividend yield, it is important to pay more dividend as share prices have rallied significantly in case of some stocks.?

Among the 71 companies that paid interim dividends in 2010-11 so far, 17 companies declared more than 100% interim dividend, 15 between 50-100% and 14 between 25-50%. But in the first five month of 2010-11, 31 companies declared interim dividend less than 25%.

Among the companies which declared more than 100% dividend during April-August 2010, include Patni Computer (3150%), Crisil (1250%), Colgate Palmolive (1000%), TCS (200%), Unichem Labs (140%) and Kennametal India (130%). Patni Computer Systems had registered a net profit of Rs 146.74 crore for the June 2010 quarter, up 8%, as against Rs 135.96 crore registered during the same period last year.The company has got benefitted from the on foreign exchange gains and has managed to post an impressive net rise.

On August 13, 2010, Patni Computer declared a special interim dividend of Rs 63 for the year ending December 2010.

Some companies that declared lower interim dividend include Foseco India (10%), Intrasoft Tech. (7.5%), Sunteck Realty ( 6%), Gokul Refoils (5%), Nissan Copper ( 5%) and Aarvee Denims (5%).

ACC has declared 100% interim dividend. Out of 71 companies, 7 declared interim dividend more than once which include Colgate Palmolive, Crisil, Foseco India, Godrej Consumer and GMM Pfaudler. Despite a decline in net profit during second quarter, Crisil declared interim dividend twice.