Which ASX lithium shares are forecasting to pay dividends in 2023?

A number of ASX lithium shares have seen a big jump in profitability over the past 12 months as lithium prices soared. Shareholders could reap some of the benefits in 2023 if dividends flow to investors.

It has been a very volatile time for the sector, with sentiment reaching exuberance a few months ago, and then falling back over the last two months. We can see that in the share price of the first ASX lithium share, I'm going to mention.

Pilbara Minerals Ltd (ASX: PLS)

In mid-November, Pilbara Minerals announced that favourable market conditions and strong operating margins support the establishment of a capital management framework, including starting to pay dividends.

It's going to balance investing for growth and rewarding shareholders.

The ASX lithium share intends to target a dividend payout ratio of between 20% to 30% of free cash flow. Management plan to start paying a dividend in FY23.

How big will the dividend be?

Commsec numbers suggest it could pay an annual dividend per share of 15 cents. The grossed-up dividend yield could be 5.4% as management is expecting to pay a fully franked dividend.

Mineral Resources Ltd (ASX: MIN)

Mineral Resources is both an ASX lithium share and an ASX iron ore share. The company is currently working on increasing its scale and earnings in both lithium and iron ore.

The company has said its five-year plan is to reach around 118,000 kt per annum.

While the business is investing in growth, it's also paying dividends to investors each year.

Commsec numbers suggest it could pay a grossed-up dividend yield of 6.7%.

IGO Ltd (ASX: IGO)

This ASX lithium share is focused on discovering, developing, and delivering products critical to clean energy.

IGO says that it "owns and operates the Nova nickel-copper-cobalt operation, the Forrestania nickel operation and the Cosmos nickel operation – all in Western Australia. IGO is also invested in a lithium focused joint venture with our partner, Tianqi lithium Corporation, which comprises a 51% stake in the Greenbushes lithium mine and 100% interest in a downstream processing refinery at Kwinana producing battery grade lithium hydroxide."

According to Commsec, it could pay an annual dividend per share of around 34 cents. That could be a grossed-up dividend yield of 3.3%.