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The Impact of Firm Size on Dividend Behaviour: A Study With Reference to Corporate Firms across Industries in India

Author

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  • Azhagaiah Ramachandran

    (Pondicherry Central University, India)

  • Veeramuthu Packkirisamy

    (Pondicherry Central University, India)

Abstract

The objective of this paper is to examine the association between the Corporate Leverage (CL) and the Dividend Policy (DP) of firms across industries in India in respect of Size of Corporate Firms. The investigation is conducted on a panel sample of 73 firms across industries [Cement, Chemical and Fertilizer, it, Oil and Gas, Pharmaceutical, Shipping, and Textiles], which listed their shares in National Stock Exchange (NSE) in India for the period 1996–2007. The impacts of Capital Structure (CS) variables (leverage) on DP measures – dividend payout (Net dividend paid/net income) in the presence of some basic fundamental variables are considered to be the determinants of DP, using the Multiple Regression Technique (OLS method). The results of the cross-sectional ols Model for the selected sample firms under various sectors show that there is a significant effect of selected independent variables. Therefore, this study proves that the DP of Small Size, Medium Size, Large Size, and Overall Corporate Firms across industries in India is dependent on the level of debt in CS.

Suggested Citation

  • Azhagaiah Ramachandran & Veeramuthu Packkirisamy, 2010. "The Impact of Firm Size on Dividend Behaviour: A Study With Reference to Corporate Firms across Industries in India," Managing Global Transitions, University of Primorska, Faculty of Management Koper, vol. 8(1), pages 049-078.
    • Handle: RePEc:mgt:youmgt:v:8:y:2010:i:1:p:049-078
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    References listed on IDEAS

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    Cited by:

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    2. Muhammad Nadeem Khan & Moona Shamim, 2017. "A Sectoral Analysis of Dividend Payment Behavior," SAGE Open, , vol. 7(1), pages 21582440166, January.
    3. Urszula Mrzyglod & Sabina Nowak & Magdalena Mosionek-Schweda & Jakub M. Kwiatkowski, 2021. "What drives the dividend decisions in BRICS countries?," Oeconomia Copernicana, Institute of Economic Research, vol. 12(3), pages 593-629, September.

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    More about this item

    Keywords

    capital structure; dividend policy; corporate leverage; long term debt; short term debt; total debt;
    All these keywords.

    JEL classification:

    • G30 - Financial Economics - - Corporate Finance and Governance - - - General
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • G35 - Financial Economics - - Corporate Finance and Governance - - - Payout Policy

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