PGP 2022-24

Section-A

Corporate finance - I

A Project Report on

Analysing the financing and dividend decision of

1. Maruti Suzuki India Limited (MSIL)
2. Page Industries Limited (PIL)

22PGP025 Sehgal Kunal Amitabh

 For Maruti Suzuki India Limited (MSIL)
Q1. Make a wise guess if you would expect your firm to have a high debt ratio or a low
debt ratio?
S. Debt Decision Paramenter Current situation Conclusion
No

Advantages

1 For Tax Tax Rate 17% Yes (Profitable firm with

benefits marginal Tax rate around
17%)

2 For Added Centralised Smaller (owing to

discipline holding concentrated holding
(56.37% approx. by
promoters, around 11% by
Mutual Funds; 6.76% by
Domestic institutions and
21.48% by Foreign
Institutions, and just 3.81%
by retail investors which is
very small number)

Disadvantages

3 Expected Direct Size and High owing to the size of

Bankruptcy bankruptcy complexity of the company and amount of
cost: costs company, the assets that company hold
number and type of (Total Assets worth:
creditors involved 74,656 crores INR )
 Indirect High priced and Moderate due to costly
bankruptcy long lived product products and durable
costs manufacturers face goods
higher indirect
bankruptcy cost
4 Agency Cost Better Low due to Maruti
reputation and Suzuki’s large amount of
very high tangible assets.
Tangible
assets and
R&D Costs
5 Flexibility Better Maturity stage The flexibility needs
Cost planning of should be lower at Maruti
funds and life Suzuki since it’s almost a
stage at which mature company with
company is at well-established
investment needs and a
reputation in capital
markets.

Assessment: Moderate level of debt may be suitable

Q2. Does the firm's current debt ratio meet your expectation?
FY Debt to Equity

Mar-18 0.013

Mar-19 0.003

Mar-20 0.003

Mar-21 0.004

Mar-22 0.010

The firm seems under-levered and has the capacity to take-on more debt.
Q3. Compute DOL, DFL, and DCL for your firm in the last year.
Profit & Loss Statement for the year 2021-2022

Mar-22 All figures in INR Crs

Particulars ₹
Sales + 70,372
Expenses - 64,961
Material Cost % 75.00%
Manufacturing Cost % 2.00%

Fixed Cost % 23%

Variable Costs 50019.97

Contribution 20,352

Fixed Cost 14,941

EBIT 5,752

OPM % 7%
Other Income + 1,861
Interest 127
Depreciation 2,789

EBT 4,697

Tax % 17%

PAT 3,880
EPS in Rs 128.43
Dividend Payout % 47%

Degree of Operating
0.28
Leverage
 Degree of Financing
1.22
Leverage
Degree of Combined
0.35
Leverage

Q4. Discuss details of your company's IPO and one-year stock market performance
post-listing for your firm.
Fundamental Analysis
Growth FY22
Revenue growth 25.0%
EBITDA growth 6.3%
EBIT growth -11.0%

Margin FY22
Gross Margin 8.4%
EBITDA Margin 5.3%
EBIT Margin 5.1%

Activity Ratios FY22

Inventory TR 18.3x
Accounts Receivable
TR 45.6x
Accounts Payable TR 6.8x
Days of Inventory 20.0
Days of AR 8.0
Days of AP 54.0
Cash conversion cycle -26.0
Operating Cycle -29.0
Working Capital Days 19.0

Liquidity Ratios FY22

Current Ratio 1.0
Quick Ratio 0.8
Inventory Turnover Ratio
(X) 12.1

Solvency Ratio FY22

Debt to Equity 0.01
Interest Coverage
Ratio 58.9x

Return Ratio FY22

RoCE
8.95 %

ROE 7.25 %

DuPont Analysis FY22

Asset Turnover Ratio 1.22
Financial Leverage
Ratio 1.32

FY Mar-17 Mar-18 Mar-19 Mar-20 Mar-21 Mar-22

Revenue 68,085 79,809 86,068 75,660 70,372 88,330
EAT 7,511 7,881 7,651 5,678 4,389 3,880

Revenue vs EAT
100,000
90,000
80,000
70,000
60,000
50,000
40,000
30,000
20,000
10,000
0
Jan-17 Jan-18 Jan-19 Jan-20 Jan-21 Jan-22

Revenue EAT
 Technical Analysis Jan 2022- Jan 2023
Summary Highest Lowest Difference Average Chg. %

9,769.00 6,536.55 3,232.45 8,517.33 13.04

CMP 8,516.65
Q5. Compute the optimal cost of capital for your firm using recent one-year data.
Cost of Equity
Tax Rate 17%
Current Debt to Equity 0.01
Beta at 0.01 D/E 1.03

Beta Unlevered 1.0215

Risk Free Rate 5.68%
13.10
Market Return %
Equity Risk Premium 7.42%

D/(D+E) Equity D/E Beta Cost of equity

0% 100% 0.00 1.022 13.26%

5% 95% 0.05 1.066 13.59%
10% 90% 0.11 1.116 13.96%
15% 85% 0.18 1.171 14.37%
20% 80% 0.25 1.233 14.83%
25% 75% 0.33 1.304 15.36%
30% 70% 0.43 1.385 15.96%
35% 65% 0.54 1.478 16.65%
40% 60% 0.67 1.587 17.45%
45% 55% 0.82 1.715 18.41%
50% 50% 1.00 1.869 19.55%
55% 45% 1.22 2.058 20.95%
60% 40% 1.50 2.293 22.70%
65% 35% 1.86 2.596 24.94%
70% 30% 2.33 3.000 27.94%
75% 25% 3.00 3.565 32.13%
80% 20% 4.00 4.413 38.42%
85% 15% 5.67 5.826 48.91%
90% 10% 9.00 8.652 69.88%
95% 5% 19.00 17.131 132.79%
99% 1% 99.00 84.960 636.08%
 Cost of Debt
Total Mcap
(Equity) 2,57,271
Total Debt 426
Total Capital 2,57,697

EBIT 5,752

Assumtions
Risk Free Rate 5.68%
ICR Ratio Default Spread Interate Rate
>8.5 0.40% 6.08%
6.5-8.5 0.70% 6.38%
4.25-6.5 0.85% 6.53%
3-4.25 1.00% 6.68%
2.5-3 2.00% 7.68%
2.25-2.5 3.00% 8.68%
1.75-2.25 4.00% 9.68%
1.75-2 5.50% 11.18%
1.5-1.75 6.50% 12.18%
1.25-1.5 7.25% 12.93%
.8-1.25 8.75% 14.43%
.65-.8 9.50% 15.18%
.2-.65 10.50% 16.18%
.2> 12.00% 17.68%

Debt Debt Interest Interest Bond Pre Tax Tax After Tax
Ratio Expense coverage Ratin Cost of Rate Cost of
ratio g Debt Debt
0% 0 0.00 Infinite AAA 6.08% 17% 5.05%
5% 12885 822.05 7.00 AAA 6.38% 17% 5.30%
10% 25770 1721.42 3.34 AAA 6.68% 17% 5.54%
15% 38655 5577.85 1.03 AAA 14.43% 17% 11.98%
20% 51539 7823.68 0.74 AAA 15.18% 12% 13.28%
25% 64424 9779.60 0.59 AAA 16.18% 10% 14.56%
30% 77309 12508.61 0.46 AAA 16.18% 8% 14.92%
35% 90194 14593.38 0.39 AAA 16.18% 7% 15.10%
40% 103079 16678.15 0.34 AAA 16.18% 6% 15.23%
45% 115964 18762.92 0.31 A+ 16.18% 5% 15.34%
50% 128849 20847.69 0.28 A 16.18% 5% 15.42%
55% 141733 22932.46 0.25 A 16.18% 4% 15.49%
60% 154618 25017.22 0.23 A 16.18% 4% 15.55%
65% 167503 27101.99 0.21 A- 16.18% 4% 15.60%
70% 180388 29186.76 0.20 A- 16.18% 3% 15.64%
75% 193273 34170.62 0.17 A- 17.68% 3% 17.17%
80% 206158 36448.66 0.16 BBB 17.68% 3% 17.21%
85% 219042 38726.71 0.15 BBB 17.68% 3% 17.23%
90% 231927 41004.75 0.14 BB 17.68% 2% 17.26%
95% 244812 43282.79 0.13 B+ 17.68% 2% 17.28%
99% 255120 45105.22 0.13 B 17.68% 2% 17.30%

Debt Equity WACC

0% 100% 13.26%
5% 95% 13.18%
10% 90% 13.12%
15% 85% 14.01%
20% 80% 14.52%
25% 75% 15.16%
30% 70% 15.64%
35% 65% 16.10%
40% 60% 16.56%
45% 55% 17.03%
50% 50% 17.49%
55% 45% 17.95%
60% 40% 18.41%
65% 35% 18.87%
70% 30% 19.33%
75% 25% 20.91%
80% 20% 21.45%
85% 15% 21.98%
90% 10% 22.52%
95% 5% 23.06%
99% 1% 23.48%

WACC
25.00%

20.00%

15.00%

10.00%

5.00%

0.00%
0% 20% 40% 60% 80% 100% 120%
Q6.
Evaluate Dividend Policy of your company by commenting on what they can afford to p
ay Vs.What they pay. Do you find evidence of certain stylized facts for your company?

Ex-Date 2022 2021 2020 2019 2018 2017 2016

Total 1,359.4 1,812.50 2,416.60 2,416.6 2,265.60 1,057.30 755.20
Dividends 0 0
3,717.6 4,220.10 5,559.20 7,494.9 7,717.40 7,338.20 5,378.30
PAT 0 0

Ex-Date 2015 2014 2013 2012 2011 2010 2009

Total 755.20 362.50 241.70 216.70 216.70 173.30 101.10
Dividends
3,790.6 2,831.60 2,448.60 1,633.6 2,307.10 2,545.00 1,231.70
PAT 0 0

Ex-Date 2008 2007 2006 2005 2004

Total 144.50 130.00 101.10 57.80 43.30
Dividends
1,789.9 1,585.40 1,216.60 880.10 560.90
PAT 0

Free Cash Flow to Equity in ₹ -1,483 Cr

2022

Dividend Paid in 2022 ₹ 3717.6 Cr

In year 2022 From the free cash flow of -1483 crs company paid 3717 Crs as dividend as per
the dividend policy mentioned below

Maruti Suzuki Dividend Policy:

The Company has already laid down the Dividend Distribution Guidelines (‘Dividend
Guidelines’) which were approved by the Board of Directors of the Company (‘Board’) on
30th October, 2014. The Securities and Exchange Board of India has amended the Securities
and Exchange Board of India (Listing Obligations and Disclosure Requirements)
Regulations, 2015 (‘Listing Regulations’) under which the Company is required to formulate
a dividend distribution policy.

Pursuant to the aforesaid change in the Listing Regulations, the Board has approved this
Dividend Distribution Policy (‘Policy’) of the Company on March 23, 2017. The Company
shall declare and pay dividend in accordance with the provisions of the Companies Act 2013,
rules made thereunder and Listing Regulations as amended from time to time.
Following points shall be considered while declaring dividend:
 Consistency with the Dividend Guidelines as laid out by the Board
 Sustainability of dividend payout ratio in future
 Dividend payout ratio of previous years
 Macroeconomic factors and business conditions
Retained earnings are intended to be utilized for:
 Investments for future growth of the business
 Dealing with any possible downturns in the business
 Strategic investment in new business opportunities
The Company currently has only one class of shares i.e. equity shares. As and when it
proposes to issue any other class of shares, the policy shall be modified accordingly.
 Sr Stylized facts Conclusion
No of Dividend
.
1 Dividends are Company paid its first dividend in 2004 and thereafter it is paying
sticky dividend consistently till date without any fail in any of the year
notwithstandin the fact that FCFE is in (-)ive

2 Dividends tend As earnings increased company has proportionatley increased its

to follow dividend
earnings
3 Dividends are
affected by tax
laws

4 Dividend Initially when company came up with IPO they didn’t gave any
policy tends to dividend untill year 2003 because it was in growth stage and when
follow the life company beacme mature with more stable earnings they rolled out
cycle of the dividends with stable growth in dividends every year
firm

Chart Title
9,000.00 3,000.00

8,000.00
2,500.00
7,000.00

6,000.00 2,000.00

5,000.00
1,500.00
4,000.00

3,000.00 1,000.00

2,000.00
500.00
1,000.00

0.00 0.00
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19

PAT Total Dividends

 For Page Industries Limited (PIL)
Q1. Make a wise guess if you would expect your firm to have a high debt ratio or a low
debt ratio?
S. Debt Decision Paramenter Current situation Conclusion
No

Advantages

1 For Tax Tax Rate 24% Yes (Profitable firm with

benefits marginal Tax rate around
28%)

2 For Added Centralised Smaller (owing to

discipline holding concentrated holding
(34.64% approx. by
promoters, around 11% by
Mutual Funds; 15.83% by
Domestic institutions and
29.54% by Foreign
Institutions, and just 8.89%
by retail investors which is
very small number)

Disadvantages

3 Expected Direct Size and Moderate owing to the size

Bankruptcy bankruptcy complexity of the of company and amount of
cost: costs company, the assets that company hold
number and type of (Total Assets worth: 2107
creditors involved crs INR )
 Indirect High priced and Low
bankruptcy long lived product
costs manufacturers face
higher indirect
bankruptcy cost
4 Agency Cost Better Low due to Page
reputation and Industries’s large amount
very high of tangible assets.
Tangible
assets and
R&D Costs
5 Flexibility Better Maturity stage The flexibility needs
Cost planning of should be lower at Page
funds and life Industries since it’s almost
stage at which a mature company with
company is at well-established
investment needs and a
reputation in capital
markets.

Assessment: Seems to be tilted in favour of benefits, hence the low to moderate level of debt
may be suitable.

Q2. Does the firm's current debt ratio meet your expectation?
FY Debt to Equity

Mar-18 0.13

Mar-19 0.08

Mar-20 0.11

Mar-21 0.21

Mar-22 0.14

As per the guess the firm has maintained a low level of debt with around 10-15% of debt of
entire capital.

Q3. Compute DOL, DFL, and DCL for your firm in the last year.
Profit & Loss Statement for the year 2021-2022
Mar-22 All figures in INR Crs
 Particulars ₹
Sales + 3,886
Expenses - 3,099
Material Cost % 44%
Manufacturing Cost % 8%

Fixed Cost % 48%

Variable Costs 1611.48

Contribution 2,275

Fixed Cost 1,488

EBIT 787

OPM % 20%
Other Income + 21
Interest 34
Depreciation 65

EBT 709

Tax % 24%

PAT 537
EPS in Rs 481.02
Dividend Payout % 77%

Degree of Operating
0.35
Leverage
Degree of Financing
1.11
Leverage
Degree of Combined
0.38
Leverage
Q4. Discuss details of your company's IPO and one-year stock market performance
post-listing for your firm.
Last 1 year performance of Stock
Fundamental Analysis
Growth FY22
Revenue growth -6.4%
EBITDA growth -20.0%
EBIT growth -21.0%

Margin FY22
Gross Margin 21.0%
EBITDA Margin 20.7%
EBIT Margin 19.1%

Activity Ratios FY22

Inventory TR 1.8x
Accounts Receivable
TR 22.8x
Accounts Payable TR 4.7x
Days of Inventory 208.0
Days of AR 16.0
Days of AP 77.0
Cash conversion cycle 147.0
Operating Cycle 224.0
Working Capital Days 36.0

Liquidity Ratios FY22

Current Ratio 1.7
Quick Ratio 0.6
Inventory Turnover Ratio
(X) 1.3

Solvency Ratio FY22

Debt to Equity 0.14
Interest Coverage
Ratio 7.8x

Return Ratio FY22

RoCE 67.00%
ROE 54.40%

DuPont Analysis FY22

Asset Turnover Ratio 2.04
Financial Leverage
Ratio 1.75

FY Mar-17 Mar-18 Mar-19 Mar-20 Mar-21 Mar-22

Revenue 2,129 2,551 2,852 2,946 2,833 3,886
Pat 266 347 394 343 341 537

4,500
4,000
3,500
3,000
2,500
2,000
1,500
1,000
500
0
Jan-17 Jan-18 Jan-19 Jan-20 Jan-21 Jan-22

Revenue Pat
 Technical Analysis Jan 2022- Jan 2023

Summary Highest Lowest Difference Average Chg. %

54,349.10 37,825.00 16,524.10 45,784.60 5.97
CMP 36,542.20
Q5. Compute the optimal cost of capital for your firm using recent one-year data.
Cost of Equity
Tax Rate 24%
Current Debt to Equity 0.14
Beta at 0.14 D/E 0.68

Beta Unlevered 0.6146

Risk Free Rate 5.68%
13.10
Market Return %
Equity Risk Premium 7.42%

D/(D+E) Equity D/E Beta Cost of equity

0% 100% 0.00 0.615 10.24%

5% 95% 0.05 0.639 10.42%
10% 90% 0.11 0.667 10.63%
15% 85% 0.18 0.697 10.85%
20% 80% 0.25 0.731 11.11%
25% 75% 0.33 0.770 11.40%
30% 70% 0.43 0.815 11.73%
35% 65% 0.54 0.866 12.11%
40% 60% 0.67 0.926 12.55%
45% 55% 0.82 0.997 13.08%
50% 50% 1.00 1.082 13.71%
55% 45% 1.22 1.186 14.48%
60% 40% 1.50 1.315 15.44%
65% 35% 1.86 1.482 16.68%
70% 30% 2.33 1.705 18.33%
75% 25% 3.00 2.016 20.64%
80% 20% 4.00 2.483 24.10%
85% 15% 5.67 3.262 29.88%
90% 10% 9.00 4.819 41.43%
95% 5% 19.00 9.490 76.09%
99% 1% 99.00 46.858 353.36%
 Cost of Debt
Total Mcap
(Equity) 40,656
Total Debt 110
Total Capital 40,766

EBIT 787

Assumtions
Risk Free Rate 5.68%
ICR Ratio Default Spread Interate Rate
>8.5 0.40% 6.08%
6.5-8.5 0.70% 6.38%
4.25-6.5 0.85% 6.53%
3-4.25 1.00% 6.68%
2.5-3 2.00% 7.68%
2.25-2.5 3.00% 8.68%
2-2.25 4.00% 9.68%
1.75-2 5.50% 11.18%
1.5-1.75 6.50% 12.18%
1.25-1.5 7.25% 12.93%
.8-1.25 8.75% 14.43%
.65-.8 9.50% 15.18%
.2-.65 10.50% 16.18%
.2> 12.00% 17.68%
Debt Debt Interest Interest Bond Pre Tax Tax After Tax
Ratio Expense coverage Ratin Cost of Rate Cost of
ratio g Debt Debt
0% 0 0.00 Infinite 6.08% 22% 4.74%
5% 2038 133.10 5.91 6.53% 22% 5.09%
.3
10% 4076 313.08 2.51 7.68% 22% 5.99%
.6
15% 6114 882.38 0.89 14.43% 20% 11.60%
.9
20% 8153 1176.51 0.67 15.18% 15% 12.95%
.2
25% 1019 1547.07 0.51 16.18% 11% 14.37%
2
30% 1223 1978.78 0.40 16.18% 9% 14.76%
0
35% 1426 2308.58 0.34 16.18% 7% 14.97%
8
40% 1630 2638.38 0.30 16.18% 7% 15.12%
6
45% 1834 2968.17 0.27 16.18% 6% 15.24%
5
50% 2038 3297.97 0.24 16.18% 5% 15.33%
3
55% 2242 3627.77 0.22 16.18% 5% 15.41%
1
60% 2446 3957.56 0.20 16.18% 4% 15.47%
0
65% 2649 4684.83 0.17 17.68% 4% 17.03%
8
70% 2853 5045.20 0.16 17.68% 3% 17.07%
6
75% 3057 5405.57 0.15 17.68% 3% 17.11%
5
80% 3261 5765.94 0.14 17.68% 3% 17.15%
3
85% 3465 6126.31 0.13 17.68% 3% 17.18%
1
90% 3668 6486.69 0.12 17.68% 3% 17.21%
9
95% 3872 6847.06 0.11 17.68% 3% 17.23%
8
99% 4035 7135.35 0.11 17.68% 2% 17.25%
8
Debt Equity WACC
0% 100% 10.24%
5% 95% 10.16%
10% 90% 10.16%
15% 85% 10.96%
20% 80% 11.47%
25% 75% 12.14%
30% 70% 12.64%
35% 65% 13.11%
40% 60% 13.58%
45% 55% 14.05%
50% 50% 14.52%
55% 45% 14.99%
60% 40% 15.46%
65% 35% 16.90%
70% 30% 17.45%
75% 25% 17.99%
80% 20% 18.54%
85% 15% 19.09%
90% 10% 19.63%
95% 5% 20.18%
99% 1% 20.61%

WACC
25.00%

20.00%

15.00%

10.00%

5.00%

0.00%
0% 20% 40% 60% 80% 100% 120%
Q6.
Evaluate Dividend Policy of your company by commenting on what they can afford to p
ay Vs. What they pay. Do you find evidence of certain stylized facts for your company?
Aug Aug Sep 3, Aug Sep Sep 5, Sep 6,
11, 12, 2020 14, 12, 2017 2016
Ex-Date 2022 2021 2019 2018
Total 334.62 278.85 179.58 377 134.96 107.08 94.81
Dividends
536.53 340.58 343.22 393.94 346.98 266.28 232.66
PAT

Sep 7, Sep Aug Aug Sep Aug 24, Sep 10,

2015 8, 30, 31, 14, 2010 2009
Ex-Date 2014 2013 2012 2011
Total 80.31 66.92 55.77 41.27 29 23.42 18.96
Dividends
196.02 153.78 112.53 89.99 58.55 39.61 31.63
PAT

Aug Mar Jul Jun Jul 16,

28, 16, 14, 29, 2004
Ex-Date 2008 2007 2006 2005
Total 11.15 4.87 4.87 2.44 4.87
Dividends
23.82 17.03 11.39 4.23 5.27
PAT

PAT vs Total Dividends

600.00 400

350
500.00
300
400.00
250

300.00 200

150
200.00
100
100.00
50

0.00 0
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19

PAT Total Dividends

 Free Cash Flow to Equity in ₹229 Cr
2022

Dividend Paid in 2022 ₹ 334.62 Cr

In year 2022 From the free cash flow of 229 crs company paid 334.62Crs as dividend as per
the dividend policy mentioned below
Page Industries Dividend Policy

Regulatory Framework: SEBI introduced Regulation 43A, which requires the top 500
listed companies to formulate a policy on dividend distribution based on market
capitalization of each financial year. This policy is aimed at complying with the
requirements of the SEBI (Listing Obligations and Disclosure Requirements) Regulations,
2015.
KEY PARAMETERS TO BE CONSIDERED WHILE DECLARING THE
DIVIDEND
1. Financial Parameters / Internal Factors:
The Board of Directors of the Company would consider the following financial
parameters before declaring or recommending dividend to shareholders:
· Net operating profit after tax;
· Working capital requirements;
· Capital expenditure requirements;
· Resources required to fund acquisitions and / or new businesses
· Cash flow required to meet contingencies; if any
· Outstanding borrowings and
· Past Dividend Trends
2. External Factors:
The Board of Directors of the Company would further consider prevailing legal
requirements, regulatory conditions or restrictions laid down under the Applicable Laws
including tax laws external factors before declaring or recommending dividend to
shareholders.
3. Range of Dividend
Subject to this policy and the factors which are necessarily to be considered at the time of
declaring / recommending the Dividend, the Board would endeavor to maintain a Dividend
pay‐out approximately 50% of PAT of the audited / limited reviewed financials.
4. The circumstances under which the shareholders of the Company may or may not
expect dividend:
Considering the past trend, the shareholders of the Company can have optimistic
expectation on dividend. However, the dividend may not be rolled out under the
following circumstances:
· If the Company undertakes or proposes to undertake an unexpected expansion
project requiring higher allocation of capital;
· Significantly unexpected higher working capital requirements adversely impacting
free cash flow;
· Whenever it undertakes any acquisitions or joint ventures requiring significant
allocation of capital;
· Whenever it proposes to utilize surplus cash for buy‐back of securities;
· In the event of inadequacy of profits / losses; or
· Any change in the regulatory frame works

5. Utilization of retained earnings:

The Company may declare dividend out of the profits of the Company for the year or out
of the profits for any previous year or years or out of the free reserves available for
distribution of Dividend, after having due regard to the parameters laid down in this Policy.
6. Parameters that shall be adopted with regard to various classes of share
The Company has only Equity share with ‘one share, one vote’ principle.
6. Parameters that shall be adopted with regard to various classes of share
The Company has only Equity share with ‘one share, one vote’ principle.
7. Approval
The Chief Financial Officer in consultation with the MD and CEO of the Company shall
recommend the amount to be declared/ recommended as Dividend to the Board of
Directors of the Company. Upon receipt of the recommendation, the Board of Directors
evaluate, discuss and either approval fully / partially or deny the recommendation
8. Review
The Board may review the policy and make changes, as it may deem fit.
 Stylized facts Conclusion
of Dividend

1 Dividends are Company paid its first dividend in 2004 and thereafter it is
sticky paying dividend consistently till date without any fail in any of
the year

2 Dividends tend As earnings increased company has proportionatley increased

to follow its dividend
earnings
3 Dividends are
affected by tax
laws

4 Dividend Initially when company came up with IPO they didn’t gave any
policy tends to dividend untill year 2002 because it was in growth stage and
follow the life when company beacme mature with more stable earnings they
cycle of the rolled out dividends with stable growth in dividends every year
firm