DIVIDEND POLICY AND FIRM VALUE: EVIDENCE FROM SELECT PHARMACEUTICAL COMPANIES IN INDIA
Dividend is a return to the equity shareholders from the portion of profits of the company for their investment in shares. The main objective of the study is to analyze “The impact of dividend policy on firm value of select Pharmaceutical Companies in India”. A Sample of top ten Pharmaceutical Companies is selected on the basis of criteria: Highest debt (Rs: in Crores), BSE Listed Companies and Dividend declared for continuous 10 years. A study period of 10 years from 2012-2013 to 2021-2022 was taken. The “Dividend Yield Ratio” and “Dividend Payout Ratio” are taken as independent variables to measure the Dividend Policy and Tobin’s Q, Price to book Ratio and Price Earnings Ratio is taken is dependent variables to assess the Firm Value. The Descriptive Statistics, Correlation and Panel Data Regression Analysis are applied to analyze the data. The findings were presented in this Research Paper. The Pharmaceutical Industry faces challenges like Lack of stable pricing, Policy environment and lack of capabilities in the innovation space. The appropriate dividend policy will help the new shareholders to invest and helps to overcome the challenges faced by Pharmaceutical Companies. It will help the pharmaceutical companies to enhance the firm value. This will lead to growth of pharmaceutical industry and economic development of India.
Dividend Policy, Firm Value and Pharmaceutical Companies in India