• Shilpa Jain IMS, Devi Ahilya Vishva Vidyalaya (DAVV), Indore, Madhya Pradesh, India
  • Vijay Kumar Gupta Indian Institute of Management (IIM), Indore


This paper aims to find out the effect of dividend on the share price in India. For this purpose, researchers collected data from a sample of 50 firms of the NIFTY-50 index from the period of 2008-2018. Independent variables are dividend per share and retention ratio. Control variables are return on equity, profit after tax, and earnings per share. Panel regression methods like pooled OLS regression, fixed-effect model, and random effect model have been applied. The results supported the fixed-effect model. The findings confirm hypotheses that dividend per share and retention ratio have no significant impact on share price, which further affirms Miller and Modigliani's theory stating that share prices are unaffected by dividend payments by the firm. However, the result shows that earnings per share and return on equity have a significant impact on share price, attributing to the viewpoint that companies which are effective in utilizing capital invested by shareholders and make a profit for them are valued high.
Aug 31, 2020
How to Cite
JAIN, Shilpa; GUPTA, Vijay Kumar. EFFECT OF DIVIDEND ON STOCK PRICE: AN INDIAN PERSPECTIVE. Management & Accounting Review (MAR), [S.l.], v. 19, n. 2, aug. 2020. ISSN 2550-1895. Available at: <http://arionline.uitm.edu.my/ojs/index.php/MAR/article/view/1048>. Date accessed: 05 aug. 2021. doi: http://dx.doi.org/10.24191/mar.v19i2.1048.