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 India's Hindustan Zinc on Wednesday declared a dividend for the second time this fiscal, amounting to 25.35 billion rupees ($304.28 million), of which the major benefactor will be cash-strapped Vedanta, holding a 64.9% stake.

The dividend of six rupees per share is below the seven rupees that the company had announced in July and lower than 26 rupees in March as well as 13 rupees in January.

The announcement comes at a time when Vedanta's UK-based parent, Vedanta Resources, is battling a host of rating downgrades, triggered by worries over outstanding dues, including $4.2 billion that the company has to pay by fiscal 2025.

"The parent needs money. Whether the company is generating enough free cash flow to distribute this money is the question to be asked. Here, that clarity is missing," said Deven Choksey, managing director of KR Choksey Investment Managers.

Group Chairman Anil Agarwal had told CNBC-TV18 in October that Vedanta had lined up finances of about $1 billion in January and $500 million-$600 million due in August to pay the dues.

Meanwhile, Hindustan Zinc - in which the Indian government holds a 29.54% stake - plans to create separate entities for its zinc, lead, silver, and recycling businesses.

The company's shares, which are marginally up so far this year, were mostly unchanged at 325.3 rupees.

Vedanta's shares, which have fallen about 18% so far this year, were up 3.2% at 250 rupees.

($1 = 83.3120 Indian rupees)