From Rs 51 dividend in 2022 to Rs 3.6 in 2025! THIS Tata company's payout decreased - Why?

Board of directors of Tata Steel has declared a 360 per cent dividend on the ordinary shares of the company, which translate to Rs 3.60 per share at a face value of Re 1. “The dividend is subject to the approval of the shareholders at the ensuing Annual General Meeting scheduled to be held on Wednesday, July 2, 2025.”

For the last 2 financial years i.e. FY23 and FY24 too, Tata Steel board had declared a cash reward of Rs 3.60 per share. Prior to that in the financial year 2022, the Tata Group company had announced a cash reward of Rs 51 per share, which was its highest-ever since 2001.

Why is there a decline in the dividend payout by the Tata Group company?

As per the company’s dividend distribution policy, Tata Steel Board while declaring or recommending dividend to the shareholders, will consider following financial/ internal and external factors which include profits earned, accumulated reserves, past dividend trends, future capital expenditure requirement, cash flows, inflation rates among others.

It further adds that the company shall endeavor to maintain a total dividend pay-out ratio in the range of 25 per cent to 40 per cent of the annual standalone profits after tax (PAT) of the company. “Under the applicable provisions of the Act, the Company’s ability to declare and pay dividends is based on the standalone Financial Statements only,” it said.

Since FY22, there has been a decline in the annual profit after tax of the company. Tata Steel’s PAT for the full financial year 2022 stood at Rs 41,749.32 crore, which declined to Rs 8,075 crore for FY23. In FY 2024, Tata Steel's consolidated net loss was Rs 4,910 crore while its stood at Rs 3,174 crore in FY25.

Meanwhile, to determine who will be eligible to receive the Rs 3.60 per share dividend for FY25, Tata Steel board has fixed Friday, June 6, as the record date. If approved by the shareholders at the AGM, Tata Steel dividend 2025 will be paid within 5 days from the date of the AGM, i.e. by July 7.