2 stocks with high dividend yield of over 10%: Buy?

High dividend yield stocks –

Coal India: CIL has declared an equity dividend amounting to ₹28.25 per share in the last year resulting in a dividend yield of 13.27%, as per data by Trendlyne. The Maharatna Public Sector Undertaking is under Ministry of Coal, Government of India. The stock has gained more than 31% in a year’s period.

The state-owned company’s consolidated net profit rose 70% at ₹7,755.5 crore as compared to ₹4,558 crore in the year-ago period whereas sales during the October-December period increased to ₹32,429 crore, over ₹25,991 crore a year ago. Further, the Board approved the payment of second interim dividend at ₹5.25 per share for the current financial year 2022-2023.

“Coal India posted Q3FY23 EBITDA ex-OBR of INR112.4bn, up 52% YoY) surpassing our estimate. We expect e-auction prices to tend lower in Q4FY23. Any increase in FSA price hike would be a key trigger for the stock (have not factored any hike). Maintain ‘BUY’ with a target price of ₹295,” said brokerage Nuvama post CIL’s Q3 results.

REC: REC has declared an equity dividend amounting to ₹13.05 per share in the past 12 months and at the current share price it results in a dividend yield of 11.41%, as per data by stock analytics platform Trendlyne. The stock is up more than 19% in a year’s period.

The state-owned infrastructure finance company reported a 5% rise in third quarter net profit at ₹2,915 crore whereas the total revenue from operations fell over 2% to ₹9,782 crore. The company, which mainly provides loans to state electricity boards, state utilities and all segments of power infrastructure in the private sector, said its interest income on loan assets grew nearly 1% to ₹9,660 crore. While announcing its earnings, its board also approved and declared the second interim dividend of ₹3.25 per share for the financial year 2022-23.