3 high-dividend paying small-cap stocks every investor should know about – Stock Insights News

For investors, dividend income often serves as a steady income source. It shows stability, potentially strong cash flows, and in many cases, a sign of management’s confidence in the business. In uncertain markets, these regular payouts serve as a steady anchor, providing returns even when stock prices fluctuate.

But not all dividend-paying stocks are created equal.

Some companies sustain high yields at the expense of future growth, while others establish a track record of consistent distributions supported by improving earnings. Even with a lower base of earnings, companies generating high cash rewards shareholders. For those seeking to balance income with reliability, a closer examination of select dividend plays becomes essential.

In this context, we examine three small-cap stocks that have yielded the highest dividends over the past 12 months, as per a report by Axis Securities.

PTC India: A Name that Pioneered Power Trading in India

PTC India is promoted by Power Grid Corporation of India, National Thermal Power Corporation, Power Finance Corporation, and National Hydroelectric Power Corporation. The company was a co-promoter of India’s first electricity exchange, the Indian Energy Exchange, and is also the Co-promoter of the Hindustan Power Exchange.

Pioneering Power Trading with a Dominant Market Share

PTC India is known for pioneering the power trading segment in India. The company is the largest player in the Indian power trading market, holding a 33% market share in terms of volume traded. It also has an investment company, PTC India Financial Services, which offers financial solutions in the power sector.

PTC has more than 7,500 megawatts (MW) of operating long-term and medium-term contracts. Renewable energy projects (including Hydro) make up 58% of the company’s operating Power Purchase Agreement (PPA) portfolio. It currently services 800 clients across all segments.

Steady Dividend Track Record

PTC has paid a total dividend of ₹19.5 in the last 12 months, including the dividend paid in September 2024 for the previous financial year. This translates into a dividend yield of 10.8% at its current price of ₹180 per share (of course, this is different from the annual dividend yield, which is lower at 6.5%). The company has a rich legacy of paying dividends to shareholders almost every year.

Talking about financial data, despite a 1.2% decline in national energy demand, trading volume grew 13% year-on-year to 23 billion units (BU) of electricity in Q1FY26. However, revenue declined 11.9% to ₹40 billion. But, despite the decline, EBITDA increased 1.3% to ₹3.8 billion, driven by a 130 basis points (bps) expansion in margins.

As a result, profit after tax (PAT) increased 28.6% to 2.4 billion. EBITDA stands for earnings before interest, tax, depreciation, and amortization.

Growth Outlook Tied to Rising Power Demand and Market Coupling

Looking ahead, PTC India expects power demand to grow steadily at 6% to 8% per annum, despite potential short-term volatility due to weather conditions. A favorable monsoon is anticipated to further boost demand.

The company aims to maintain its growth momentum, noting that its trading volumes have been growing faster than the country’s total energy generation rate. PTC also expects to benefit from “market coupling“, which will significantly help Hindustan Power Exchange, indirectly benefit PTC as well. PTC considers this a major driver of its business.

All these developments are potentially supportive of attractive dividend payments in the years to come.

From a valuation perspective, PTC India is trading at a price-to-earnings (P/E) multiple of 8.6x, slightly higher than the 10-year median of 7x.

PTC India Share Price

MSTC: A Pioneer in Metal Trading and E-Auction Services in India

MSTC, a Mini-Ratna Public Sector Undertaking, is engaged in commodities trading and e-commerce services, e-auction, and e-procurement services. It conducts e-auctions of scrap, e-sales of mineral blocks, spectrum, FM channels, properties, and coal auctions on behalf of Coal India.

High Dividend Yield

MSTC has paid a dividend of ₹45.5 in the last 12 months (again, including the final dividend paid out in September 2024 for FY24). This translates into a dividend yield of 9.6% at its current price of ₹474 per share (the annual dividend yield in FY25 was 8.5%). MSTC also has a rich legacy of paying dividends to shareholders almost every year.

From a financial perspective, revenue grew 12.1% year-on-year to ₹774 million in Q1FY26. This was led by e-commerce, which rose 13.7% to ₹700 million. The remaining revenue came from marketing and other segments. Profit after tax (PAT) also grew 7.8% to ₹423 million. The company expects the e-commerce vertical to remain a key growth driver going forward as well.

This increase was driven by the allocation of FM channels through e-auction by the Ministry of Information and Broadcasting. MSTC allocated a total of 63 licenses for 15 years in 43 cities during the quarter. Coal and iron ore auctions and scrap disposal auctions also contributed to the growth.

Future Growth Anchored in Digital Platforms and ERP Solutions

Looking ahead, beyond its core business, it is actively pursuing new initiatives within its e-commerce framework. MSTC has identified software application development to leverage its strengths by developing small Enterprise Resource Planning (ERP) applications and dashboards.

It has also recently launched a product to bring original equipment manufacturers and major industrial equipment vendors on a digital platform. The company will facilitate transactions related to leasing or buying industrial equipment. It was showcased at the India Steel Summit in April.

MSTC is trading at a P/E multiple of 15.3x, slightly higher than the 6-year median of 14.4x.

MSTC Share Price

La Opala: A Brand that Redefined Opalware in India

La Opala was the first company to introduce opal glass in 1989. Subsequently, it pioneered crystal glass technology in 1995. The company has four brands and ten sub-brands, and operates three manufacturing facilities with a combined capacity of 32,000 metric tons per annum. It’s a pan-India player with international presence in 40+ countries.

Attractive Dividend Yield Despite Near-Term Revenue Decline

La Opala has paid a dividend of ₹17.5 in the last 12 months (again, including the final dividend paid out in September 2024 for FY24). This translates into a dividend yield of 7% at its current price of ₹246 per share (of course, this is different from FY25 annual dividend yield of 3%). The company also pays dividends to shareholders almost every year.

Revenue from operations declined 10.4% year-on-year to ₹652 million in Q1FY26. However, margins improved by 36 basis points to 36.9%, leading to a 7.1% increase in profit after tax (PAT) to ₹253.5 million. La Opala is trading at a P/E multiple of 27.7x, lower than the 10-year median of 37.3x.

Distribution Expansion and Value-Added Products to Drive Growth

Looking ahead, the company expects revenue recovery from FY26 onwards, following one-time restructuring of its distribution base and the completion of furnace relining operations. The company has also completed major capex, creating a platform for revenue and margin growth.

La Opala plans to strengthen its distribution network. It also aims to increase revenue from cash-and-carry sales and the proportion of value-added products. The company is deepening its presence in large-format stores and e-commerce marketplaces to expand consumer access.

La Opala Share Price

Conclusion

PTC India, MSTC, and La Opala stand out for their high dividend yields, but the investment case extends beyond payouts. Each company operates in a niche with structural growth drivers, rising power demand for PTC, digital auction expansion for MSTC, and premiumisation in tableware for La Opala. Dividend visibility remains strong, though investors must weigh sectoral risks and earnings consistency before positioning these stocks as steady income plays.

Disclaimer

Note: Throughout this article, we have relied on data from and the company’s investor presentation. Only in cases where the data was not available have we used an alternate but widely used and accepted source of information.

The purpose of this article is only to share interesting charts, data points, and thought-provoking opinions. It is NOT a recommendation. If you wish to consider an investment, you are strongly advised to consult your advisor. This article is strictly for educational purposes only.

Madhvendra has been deeply immersed in the equity markets for over seven years, combining his passion for investing with his expertise in financial writing. With a knack for simplifying complex concepts, he enjoys sharing his honest perspectives on startups, listed Indian companies, and macroeconomic trends.

A dedicated reader and storyteller, Madhvendra thrives on uncovering insights that inspire his audience to deepen their understanding of the financial world.

Disclosure: The writer and his dependents do not hold the stocks discussed in this article.

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