Impact on the dividend payout ratio before and after the recession- A Study on NSE Listed Companies

Abstract

In order to evaluate the true organizational position and performance, dividend considered as one of the major factor. Any investor before investing in any company check its dividend payout performance. Dividend payout ratio is clear indication of organization sum is returning to investors relative to the amount of money kept by the company for the purpose of reinvestment into the company. A low payout rate of dividends signifies that a company is reinvesting a large portion of its net income, whereas a high payout rate of dividends means that the company distributes a large amount of its profits to investors. This work is carried out to analyze the quality for payout ratio of dividend of 13 companies of India in 2004 which are listed in NSE. The purpose of the selection of a particular year 2004 is that, 2007 is the year of recession and the study is conducted to include three years before and after the recession period.