Dividend Practices in Public Sector Undertakings-A Case Study of India

Abstract

Dividend decision has been a subject of sincere concern for researchers and financial experts for more than five decades. The questions of "how much dividend should be paid and what factors determine dividend payout decision " have puzzled the researchers and decision makers. The present paper is the outcome of a study of public sector undertakings belonging to mining industry in India. The study is aimed to bring out the dividend pattern of the public sector firms. It also examines the variance in dividends over the years and across the various industry groups by applying ANO VA test. The study involves a period of ten years (i.e 2005-2014). The findings indicate that around one fourth of the profits after tax is distributed as dividend by the sample companies. The study further showed that DPS and EPS vary significantly across the time period and across various industry groups.