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Interim Dividend - Requirements

Dhruv (article) (100 Points)

09 July 2011

I earlier asked quetion regarding this , but seems there was some confusion regarding inference , reframing the question
" INTERIM DIVIDEND should be paid out of the first six months profit of current year in which it is declared?? "
eg : If on NoV 2011 reliance declares interim dividend of 100% say10 per share can it be paid only from first six months profit of the financial year 2011-12 ie profits arising from 1st april to 30th sept ,2011 only ??

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2 Replies

Max Payne (employed) (2569 Points)
Replied 09 July 2011

Straight answer is YES.

But that is still based on insufficient info yaar. Interim dividend should be declared out of the profits for the entire year, not a part of the year.

If you have profits in the first 6 months, and you are expecting losses to wipe out that profit in the next half year, BOD has should not declare interim dividend. The provision is that the same conditions as dividend should be fulfilled for interim dividend also.

CS Ankur Srivastava (Company Secretary & Compliance Officer) (17848 Points)
Replied 09 July 2011

The date on which the Board of Directors declaring the interim dividend the profit as on that date and Directors' view about the remaing term profit is to be considered for determining the Interim Dividend.