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International Journal of Innovation and Applied Studies
ISSN: 2028-9324     CODEN: IJIABO     OCLC Number: 828807274     ZDB-ID: 2703985-7
 
 
Wednesday 26 September 2018

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Impact of Dividend Policy on Shareholders' Wealth: A Study of Selected Manufacturing Industries of Pakistan


Volume 6, Issue 2, June 2014, Pages 210–215

 Impact of Dividend Policy on Shareholders' Wealth: A Study of Selected Manufacturing Industries of Pakistan

Zafar Iqbal1, Muhammad Arfaq Waseem2, and Muhammad Asad3

1 Assistant Professor Mirpur University of Science and Technology AJK, Pakistan
2 Research Associate University of Azad Jammu & Kashmir Campus Kotli AJK, Pakistan
3 Lecturer Mirpur University of Science and Technology AJK, Pakistan

Original language: English

Received 10 May 2014

Copyright © 2014 ISSR Journals. This is an open access article distributed under the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.

Abstract


This study examines the impact of dividend policy on shareholders' wealth in context of Pakistan. Thirty five companies randomly from three sectors; Textile, Sugar and Chemical are observed in the study. The annual data for these companies from 2006 to 2011 is used in the study. Simple OLS technique for analysis is used to derive the results of the study. The findings showed that dividend policy of the firm has significant positive impact on shareholders wealth. Similarly firm growth rate also has significant positive impact on shareholders' wealth. Firm size has significant positive impact on shareholders wealth; indicating that large domain of operations of a business make it more capable to exploit maximum opportunities and in position to earn greater amount of return due to greater growth prospects so it ultimately place greater value to shares of large size companies. The results of study help the corporate management to better decide the level of dividend to be distributed so that shareholders wealth could be maximized.

Author Keywords: Dividend, Shareholders' wealth, Relevance theory.


How to Cite this Article


Zafar Iqbal, Muhammad Arfaq Waseem, and Muhammad Asad, “Impact of Dividend Policy on Shareholders' Wealth: A Study of Selected Manufacturing Industries of Pakistan,” International Journal of Innovation and Applied Studies, vol. 6, no. 2, pp. 210–215, June 2014.