Top 15 Stocks With Dividend Yield of More Than 8%

9. Indus Motor Company 

Forward Dividend Yield: 9.2%

Dividend Yield and Payout Profile

Indus Motor Company is recognized for its shareholder-friendly policies and consistent payout history.

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• Historical Dividend Yield: For the fiscal year ending June 2025 (MY25A), the stock delivered a robust dividend yield of 10.14%.
• Dividend Payout Policy: The company maintains a consistent payout policy, historically distributing approximately 60% of its annual earnings as dividends to shareholders.
• Historical and Projected Dividends per Share (DPS):
  • MY24 (Actual): Rs 114.70.
  • MY25 (Actual): Rs 176.00.
  • MY26 (Projected): Rs 182.00.
  • MY27 (Projected): Rs 297.00.
• Projected Dividend Yield (MY27F): Based on projected earnings growth and the 60% payout policy, analysts anticipate a dividend yield of 8.46% for the 2027 fiscal year.

Latest Corporate Briefing and Operational Highlights

Recent management disclosures and operational reviews highlight the company’s strategic positioning:

• Market Leadership: INDU maintains a dominant 50.26% market share in the 1300cc and above passenger car segment.
• Strong Order Book: The Toyota Corolla is currently being delivered with a lead time of 7–8 months, underscoring sustained demand momentum.
• Localization Strategy: The launch of the Corolla Cross HEV represents Pakistan’s first locally assembled hybrid vehicle with the highest-ever localized content. This reduces exposure to exchange rate volatility and supports gross margin expansion, which reached 14.5% in MY25.
• Cash Generation: The company reported high liquidity with operating cash flows of Rs 41,237 million (equivalent to Rs 525 per share) in MY25, providing a strong buffer for continued dividend distributions.
• Competitive Landscape: Management has expressed caution regarding the import of used vehicles, which rose to over 42,000 units in MY25, potentially impacting domestic market share in entry-level segments. Additionally, competition is intensifying in the SUV and pickup categories from new Chinese entrants.

Indus Motor Company Limited (INDU)

Indus Motor Company is widely known for its shareholder-friendly approach, maintaining a consistent dividend policy while benefiting from strong brand positioning and demand recovery in the auto sector.

Consistent dividend policy and yield

The company has a track record of rewarding shareholders, typically distributing around 60% of its annual earnings as dividends. For the fiscal year ending June 2025, the stock delivered a dividend yield of 10.14%, placing it among the higher-yielding names in the market. Dividend payments have also shown strong growth, rising from Rs 114.70 in MY24 to Rs 176.00 in MY25. Looking ahead, dividends are projected to increase further to Rs 182.00 in MY26 and Rs 297.00 in MY27. Based on these projections, the expected dividend yield for MY27 stands at 8.46%, supported by earnings growth and a stable payout policy.

Volume recovery supports earnings outlook

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The company has seen a strong rebound in sales during FY26, which strengthens its ability to sustain future payouts. In the first eight months of FY26, total volumes are expected to reach 29,440 units, reflecting a 59% year-on-year increase. For February 2026 alone, sales are estimated at around 3,800 units, up 46% year-on-year.

Product mix driving growth

Growth is largely being driven by key models. The Toyota Yaris is expected to see sales increase by 2.4 times year-on-year in February 2026, accounting for roughly 48% of total volumes, supported by strong commercial demand. At the same time, Toyota Corolla sales are estimated to grow by 31% year-on-year, while the Corolla Cross HEV continues to contribute to the company’s higher-margin product mix, despite rising competition in the hybrid segment.

Market leadership and demand visibility

Indus Motor maintains a strong position in the market, holding a 50.26% share in the 1300cc and above passenger car segment. Demand remains solid, particularly for the Corolla, where delivery lead times currently stand at 7 to 8 months, indicating a strong order book and sustained consumer interest.

Localization and margin support

The company’s localization strategy is another key strength. The Corolla Cross HEV is Pakistan’s first locally assembled hybrid vehicle with high localized content, which helps reduce exposure to exchange rate fluctuations. This has supported margins, with gross margin reaching 14.5% in MY25.

Strong cash flows enable payouts

Indus Motor’s ability to maintain high dividends is backed by strong liquidity. In MY25, the company generated operating cash flows of Rs 41,237 million, equivalent to Rs 525 per share. This strong cash position provides a solid foundation for continued dividend distributions.

Competitive risks remain

Despite its strengths, the company faces rising competition. Imports of used vehicles exceeded 42,000 units in MY25, which could impact entry-level segments. In addition, competition is increasing in the SUV and pickup categories, particularly from new Chinese entrants, which may affect market share over time.

Bottom line

Indus Motor Company Limited offers a compelling combination of high dividend yield, strong cash flows, and market leadership. With consistent payouts above 8%, a recovering auto cycle, and an improving product mix, the company remains a solid option for investors seeking both income and exposure to growth in Pakistan’s automobile sector.

⚠️ This post reflects the author’s personal opinion and is for informational purposes only. It does not constitute financial advice. Investing involves risk and should be done independently. Read full disclaimer →