Nexus between Dividend Policy and Value of Firm: Evidence from Emerging Economy

Abstract

Examining the connection between dividend policy and value of firm is the main goal of this research. The sample consists of 70 enterprises from 2014 to 2023. The financial statements of the chosen companies were employed to construct the panel data. The dependent variable was value of firm (Tobins Q), while the independent variables were price earnings ratio (PER), dividend payout ratio (DPOR) and earnings per share (EPS). Descriptive analysis, correlation, and multiple regression were employed as data analysis methods. The findings demonstrates that there is a positive link among value of firm and dividend policy. Tobins Q is favorably impacted by the dividend payout ratio, price-earnings ratio and profits per share. Our study's limitation is that the researcher select only 70 companies; other researchers utilize a larger sample size, and single sector companies such as manufacturing and financial.