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Abstract
Every firm operating in a given industry follows some sort of dividend payment pattern or
dividend policy and obviously it is a financial indicator of the firm. Managements’ primary
goal is shareholders’ wealth maximization, which translates into maximizing the value of the
company as measured by the price of the company’s common stock. Dividend policy is
challenging for the directors and financial managers of a company, because different
investors have different views on present cash dividends and future capital gains and also
regarding the extent of effect of these dividends on the share price. This paper intends to
study the impact of dividend on the price and volume before and after such dividend is
announced and to analyze the dividend payment trend of BSE firms. The objective of