ICTACT Journal on Management Studies

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Impact of DPS on MPS:A Study on Leading Indian Cement Companies


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1 Institute of Computer Accountants, Kolkata, India
     

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Risks and uncertainties are inherent in every organisation. Different class of investors in do not shoulder the same degree of risk. An investor in bonds earns return in from interest while shareholders depend on dividends, stock price appreciation. Dividend refers to the distribution of profit among the shareholders. Profit earned by a company can be retained for future usage, or distributed in form of dividend or both. Dividend decision is one of the important decisions, since it determines the amount of profit to be distributed among shareholders and the amount to be retained earnings for future investment purpose. This is known as Dividend Policy. The main objective of every company is to maximize shareholders wealth rather than profit. Shareholders gain both from Dividend as well as Capital Appreciation. Moreover, dividend policy of a company has an impact on its market price. Market price increases only if a company provides stable return to its shareholders. This paper focuses on the impact of dividend on Market Price of a company.

Keywords

Indian Cement Sector, Net Profit Margin, Dividend Per Share, Dividend Yield, Earnings Per Share, Market Price Per Share, Price Earnings Ratio.
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  • Impact of DPS on MPS:A Study on Leading Indian Cement Companies

Abstract Views: 244  |  PDF Views: 0

Authors

Sri Ayan Chakraborty
Institute of Computer Accountants, Kolkata, India

Abstract


Risks and uncertainties are inherent in every organisation. Different class of investors in do not shoulder the same degree of risk. An investor in bonds earns return in from interest while shareholders depend on dividends, stock price appreciation. Dividend refers to the distribution of profit among the shareholders. Profit earned by a company can be retained for future usage, or distributed in form of dividend or both. Dividend decision is one of the important decisions, since it determines the amount of profit to be distributed among shareholders and the amount to be retained earnings for future investment purpose. This is known as Dividend Policy. The main objective of every company is to maximize shareholders wealth rather than profit. Shareholders gain both from Dividend as well as Capital Appreciation. Moreover, dividend policy of a company has an impact on its market price. Market price increases only if a company provides stable return to its shareholders. This paper focuses on the impact of dividend on Market Price of a company.

Keywords


Indian Cement Sector, Net Profit Margin, Dividend Per Share, Dividend Yield, Earnings Per Share, Market Price Per Share, Price Earnings Ratio.

References