IDEAS home Printed from https://ideas.repec.org/a/taf/oaefxx/v6y2018i1p1423895.html
   My bibliography  Save this article

Determinants of dividends among Indian firms—An empirical study

Author

Listed:
  • B. Rajesh Kumar
  • K.S. Sujit

Abstract

The study aims to understand the determinants of dividend trends of Indian firms. The study was based on a sample of 31,234 firms representing 15 different industry sectors. Construction materials, machinery and transportation equipment sectors were the most dividend intensive sectors in India. Partial least square structural equation modeling methodology (PLS SEM) was employed to examine the determinants of the dividend intensity of Indian firms. Different schemes of path models were tested and the results show that the higher the financial leverage, the lower is the propensity to pay dividends. Firms with high intangibles are expected to have higher agency costs. High growth firms have low dividend payout policies. Dividend intensity of firms is directly related to the size of firm. Higher the R&D intensity of the firms, greater is the dividend intensity of the firms. Firms with higher agency costs tend to have higher dividend intensity. Higher agency costs lead to lower cash flows for Indian firms. Firms with higher liquidity tend to pay more dividends. Profitable firms tend to have higher dividend intensity.

Suggested Citation

  • B. Rajesh Kumar & K.S. Sujit, 2018. "Determinants of dividends among Indian firms—An empirical study," Cogent Economics & Finance, Taylor & Francis Journals, vol. 6(1), pages 1423895-142, January.
    • Handle: RePEc:taf:oaefxx:v:6:y:2018:i:1:p:1423895
    DOI: 10.1080/23322039.2018.1423895
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1080/23322039.2018.1423895
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1080/23322039.2018.1423895?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Ali, Heba & Hegazy, Aya Yasser, 2022. "Dividend policy, risk and the cross-section of stock returns: Evidence from India," International Review of Economics & Finance, Elsevier, vol. 79(C), pages 169-192.
    2. Sunaina Kanojia & Bunny Singh Bhatia, 2022. "Corporate governance and dividend policy of the US and Indian companies," Journal of Management & Governance, Springer;Accademia Italiana di Economia Aziendale (AIDEA), vol. 26(4), pages 1339-1373, December.
    3. Ateyah Alawneh, 2018. "Dividends, Net Income After Taxes and Earnings Per Share and Their Impact on the Market Capitalization of Listed Companies Amman Stock Exchange During the Period 1978-2016," International Journal of Economics and Finance, Canadian Center of Science and Education, vol. 10(10), pages 1-69, October.
    4. Novi Swandari Budiarso, 2019. "Agent, Steward, and Dividend Policy," European Research Studies Journal, European Research Studies Journal, vol. 0(3), pages 83-94.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:oaefxx:v:6:y:2018:i:1:p:1423895. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/OAEF20 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.