Coal India tops Nifty on higher final dividend

Shares in Coal India surged as much as 2.6 per cent on Tuesday after the state-run miner recommended higher than expected dividend for the 2012-13 fiscal year. Coal India recommended final dividend of Rs 4.30 per share against Rs 0.50 per share dividend announced in 2011-12.

Coal India shares traded up 2.1 per cent at Rs 307.20 as of 11.50 a.m. after hitting an intraday high of Rs 308.50. The stock was the top gainer on the 50-share Nifty.

Global investment bank Nomura says the final dividend is above consensus forecast, given that an interim dividend of Rs 9.70 per share in March 2013 was disappointing and lowered expectations of the full year dividend for 2012-13.

Nomura maintained its buy call on Coal India. Coal India's price earnings valuation at 9.3-times FY14F is attractive, the investment bank said.