High Dividend Yielding Stocks: ENGINEERS INDIA

Engineers India is a leading player in the hydrocarbon segment, providing engineering services for refining, petrochemicals, offshore oil & gas, pipelines, fertilisers, etc. It has been a key beneficiary of investments in the hydrocarbon segment. Analysts are expecting it to grow at about 25 per cent annually over the next two years, given the strong order book of `7,400 crore or about 2.5 times its 2010-11 sales. Importantly, it is a zero-debt company, earning over 40 per cent return on equity. It has good cash flow and a large part of this is paid in the form of dividends. In fact, it is sitting on cash of about `2,200 crore, almost 25 per cent of its market capitalisation. "At current levels, there is definitely value in the stock, considering the cash on the books and the dividend yield. We value the stock at 400 per share, as against its current price at `272.8," says Ravi Shenoy, who tracks midcap companies at Motilal Oswal Securities.