AN EMPIRICAL ANALYSIS OF DIVIDEND PAYOUT RATIOS OF SELECTED INDIAN PHARMACEUTICAL COMPANIES
Keywords:
Dividend policy, Profitability, Trend analysis, ANOVAAbstract
Dividend policy is an important decision area in the domain of financial management. The present paper examines the trends in dividend payment pattern of selected Indian Pharmaceutical companies over the period of 1997-2006. There is a significant relationship between dividend and profit. Dividend policy is mostly influenced by the profitability of the company. An attempt has been made to analyze the different trends in the dividend payout with the help of trend analysis. Dividend Payout Ratio is an important variable which is used for the purpose of analysis of dividend payment trend. A statistical technique such as mean has been used to know the average payout of the different Pharmaceutical Companies. Further, to know the significant difference of dividend payout of the different Pharmaceutical Companies, hypothesis has been framed and tested with the help of ANOVA test. The result of this paper reveals that average dividend payout ratio is significantly different in the Indian Pharmaceutical Companies selected for the study over the period of 1997 to 2006.
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