Determinants Analysis of Corporate Dividend: With Special Reference To Indian IT Industry

Abstract

The dividend pay-out policy is one of the most debated topics within corporate finance and some academics have called the company‟s dividend pay-out policy an unsolved puzzle. Even though an extensive amount of research regarding dividends has been conducted, there is no uniform answer to the question: what are the determinants of the companies‟ dividend pay-out ratios? We, therefore, decided to conduct a study regarding the determinants of the companies‟ dividend pay-out ratios on large and medium cap on Stockholm Stock Exchange. The purpose of the study is to determine if there is a relationship between numbers of company selected factors and the companies‟ dividend pay-out ratios. A second purpose is to determine whether there are any differences between large and medium caps regarding the impact of the company selected factors. We, therefore, reviewed previous studies and dividend theories in order to conclude which factors that potentially could have an impact on the companies‟ dividend pay-out ratios.