For investors holding shares in their demat accounts, staying informed about dividend declarations is essential for maximizing returns. This article explores the various ways investors can be notified when a company in their demat holdings declares a dividend, including the role of organizations like Linktimes.
Understanding Dividends
Dividends are payments made by companies to their shareholders, typically derived from profits. They can be classified into two types:
- Interim Dividends: Declared at any time during the financial year based on the company’s performance.
- Final Dividends: Declared at the Annual General Meeting (AGM) based on the annual financial results.
Notification Mechanisms
- Company Announcements
When a company declares a dividend, it must notify stock exchanges like the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE). These announcements are publicly accessible and can be found on:
- Stock Exchange Websites: Investors can check for updates directly on BSE or NSE websites.
- Company Websites: Most companies publish dividend announcements in the investor relations section of their official websites.
- NACH Notifications via RTA
Organizations such as Linktimes facilitate the distribution of dividends through NACH, which allows for electronic crediting of dividends directly to shareholders’ bank accounts. When a company declares a dividend:
- Email Notifications: Linktimes and similar organizations may send out email notifications to inform investors about upcoming dividend payments and relevant details.
- Direct Bank Transfers: Once declared, dividends are typically credited directly to the bank account linked with the investor’s demat account via NACH, ensuring a seamless transaction process. Most banks also sends you a credit alert notification when this dividends reach your account.
Key Dates to Remember
To qualify for dividends, shareholders must hold shares in their demat accounts by the ex-date or record date set by the company:
- Ex-Date: The date on which shares begin trading without the right to receive the declared dividend.
- Record Date: The date set by the company to determine which shareholders are eligible to receive dividends.
What If You Don’t Receive Your Dividend in India?
If you believe you are eligible for a dividend but have not received it:
- Check Eligibility: Ensure you held shares on the record date.
- Contact Your Bank: As instructed in the attached sample screenshot communication from the RTA, please reach out to your local bank branch for assistance.
- Registrar of Companies (RTA): If issues persist, contact the company’s Registrar and Transfer Agent for further clarification. RTAs require you to have a confirmation from your bank indicating that the Dividend Credit was not received by the bank.
Being informed about dividend declarations is crucial for investors looking to optimize their returns. By utilizing company announcements, brokerage platforms, and monitoring demat account statements (along with receiving notifications from the RTA’s) investors can ensure they stay updated on corporate actions affecting their investments.