Submitted by : Group – 3 ( Corporate Finance)

Title: Impact of Dividend behavior on share prices of Indian firms

Dividend policy decision is one of the three decisions of financial management because it

affects the financial structure, the flow of funds, corporate liquidating and investors’ attitudes.

The main aspect of dividend policy is to determine the amount of earning to be distributed the

shareholder and the amount to be retained in the firm. Dividend policy involves the decision to

pay out earning versus retaining them for reinvestment in the firm. The relationship between

dividend and the value of the share is not clear cut. The financial manager must understand the

various conflicting factors which influence the dividend policy before deciding the allocation of

its company’s earnings into dividends and retain earnings.

This study will focus on the dividend practice and its influence on stock prices of Indian IT

industry including major IT players Infosys, TCS, HCL Wipro, Tech Mahindra and Mind Tree for

last five/ten year.

The study will show the degree of correlation between the mentioned 6 listed companies and

industry with respect to the number of cash dividend paying companies. Most of the IT

companies not being capable of declaring cash dividend to their shareholders. Our study will

wrap up the difference between the average MPS (market price per share) before and after the

cash dividend.

Time Line:

Activities Time Line

Primary study and data collection for dividend and MPS for all 6

companies 25-Aug-15

Industry analysis : dividend behavior and MPS 31-Aug-15

Summary of findings 7-Sep-15

Report Preparation and submission 14-Sep-15

Submitted by : Group – 3 ( Corporate Finance)

Industry selection: Indian IT industry (Infosys, TCS, HCL Wipro, Tech Mahindra and Mind Tree)

Following candidates will cover the study of the impact of dividend behavior on share prices of

the respective firm.

Name of the candidate Roll No Company

Pawan Kumar Verma 70 HCL

Ravish Sehgal 79 TCS

Shital Desai 81 Infosys

Jahid Ahmed 62 Mind Tree

Akhilendra Tiwari EM-01 Wipro

Aditya Rajain 50 Tech Mahindra

References :

http://www.moneycontrol.com/stocks/marketstats/hidivyields.php?optex=BSE&indcode=25&g

roup=All