Understanding Cash Dividends at the PSX

A cash dividend is a share of a company's profit, paid directly to you in cash.

When a company listed on the Pakistan Stock Exchange (PSX) earns a profit, its Board of Directors can vote to return a portion of that money to its investors. This reward is calculated on a per-share basis.

At the PSX, cash dividends are paid electronically. The funds are deposited directly into the bank account you have linked with your Central Depository Company (CDC) account.

Receiving a dividend is all about timing. To be eligible for the payment, you must be a shareholder on a specific date. This process is managed through several key dates announced by the company.

This is when the company's Board of Directors formally declares the dividend. The announcement will specify the amount (e.g., "Rs. 2 per share") and is made public via the PSX.

The company specifies a date range (e.g., Oct 20 - Oct 22) to finalize its records. To be eligible for the dividend, you must be listed as an official shareholder before the start of this period. This is how the company determines exactly who to pay.

This is the most important date for investors. It is the cut-off day for dividend eligibility.

· To Receive the Dividend: You must purchase the stock before the ex-dividend date.

· If You Buy on or After: You will not receive the upcoming dividend.

· If You Sell on or After: If you already own the stock, you will still receive the dividend even if you sell on or after this date.

This is the day the cash is actually transferred. As per Pakistani regulations, the payment must be sent to your registered bank account within 15 working days of the announcement.

You can find all official announcements for cash dividends, book closure dates, and ex-dividend dates in the announcements section.

You can also set alerts to receive a notification before the ex-date of a company of your choice.