1Designation: Research Scholar Address: DOS in Business Administration, [BIMS], University of Mysore, Manasagangotri, Mysore
2Designation: Associate Professor Address: DOS in Business Administration, [BIMS], University of Mysore, Manasagangotri, Mysore.
Online published on 8 August, 2018.
A dividend decision of a firm is an outcome of various considerations. These considerations differ across time and industry. The present study re-examines various factors that have a bearing on the dividend decision of a firm by using a two-step multivariate procedure. First factor analysis is performed on the data to extract prominent factors from various variables and then multiple regression is conducted on such factors. Results of factor analysis indicate that leverage, liquidity, profitability, growth and ownership structure are the major factors. Regression on these factors shows leverage and liquidity to be the determinants of the dividend policy for Indian companies.
Dividend policy, factor analysis, multiple regression, leverage, liquidity
