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Abstract

The relevance of dividend policy in determining the market value of firm has led to contradictory opinions leading to emergence of multiple theories in past explaining the same. The present study is an unbiased attempt by the researcher to understand the significance of dividend policy as well as shareholder’s earnings and capital structure framework of companies in determining the market value of shares. 10 companies of BSE SENSEX has been selected as a sample for the purpose of the study conducted data over a period of 10 years.  Linear as well as multiple regression techniques are applied for examining the stated hypothesis. it is concluded that dividend policy and Earning Per Share are important parameters for predicting market performance of firms but capital structure of firms have not much role to play in market performance.

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