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Campus Activewear Limited (NSE:CAMPUS) Looks Interesting, And It's About To Pay A Dividend

Simply Wall St · 2d ago

Readers hoping to buy Campus Activewear Limited (NSE:CAMPUS) for its dividend will need to make their move shortly, as the stock is about to trade ex-dividend. The ex-dividend date is commonly two business days before the record date, which is the cut-off date for shareholders to be present on the company's books to be eligible for a dividend payment. The ex-dividend date is of consequence because whenever a stock is bought or sold, the trade can take two business days or more to settle. Thus, you can purchase Campus Activewear's shares before the 31st of July in order to receive the dividend, which the company will pay on the 19th of September.

The company's upcoming dividend is ₹1.50 a share, following on from the last 12 months, when the company distributed a total of ₹1.50 per share to shareholders. Looking at the last 12 months of distributions, Campus Activewear has a trailing yield of approximately 0.7% on its current stock price of ₹216.55. We love seeing companies pay a dividend, but it's also important to be sure that laying the golden eggs isn't going to kill our golden goose! So we need to check whether the dividend payments are covered, and if earnings are growing.

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Dividends are typically paid out of company income, so if a company pays out more than it earned, its dividend is usually at a higher risk of being cut. Campus Activewear has a low and conservative payout ratio of just 6.5% of its income after tax. That said, even highly profitable companies sometimes might not generate enough cash to pay the dividend, which is why we should always check if the dividend is covered by cash flow. Luckily it paid out just 21% of its free cash flow last year.

It's encouraging to see that the dividend is covered by both profit and cash flow. This generally suggests the dividend is sustainable, as long as earnings don't drop precipitously.

View our latest analysis for Campus Activewear

Click here to see the company's payout ratio, plus analyst estimates of its future dividends.

historic-dividend
NSEI:CAMPUS Historic Dividend July 27th 2026

Have Earnings And Dividends Been Growing?

Businesses with strong growth prospects usually make the best dividend payers, because it's easier to grow dividends when earnings per share are improving. If earnings fall far enough, the company could be forced to cut its dividend. It's encouraging to see Campus Activewear has grown its earnings rapidly, up 41% a year for the past five years. Campus Activewear earnings per share have been sprinting ahead like the Road Runner at a track and field day; scarcely stopping even for a cheeky "beep-beep". We also like that it is reinvesting most of its profits in its business.'

Unfortunately Campus Activewear has only been paying a dividend for a year or so, so there's not much of a history to draw insight from.

To Sum It Up

Is Campus Activewear an attractive dividend stock, or better left on the shelf? Campus Activewear has been growing earnings at a rapid rate, and has a conservatively low payout ratio, implying that it is reinvesting heavily in its business; a sterling combination. There's a lot to like about Campus Activewear, and we would prioritise taking a closer look at it.

While it's tempting to invest in Campus Activewear for the dividends alone, you should always be mindful of the risks involved. For example, we've found 1 warning sign for Campus Activewear that we recommend you consider before investing in the business.

Generally, we wouldn't recommend just buying the first dividend stock you see. Here's a curated list of interesting stocks that are strong dividend payers.