Determinants of Dividend Policy in Indian FMCG Sector: A Comprehensive Literature Review

The present study aims to identify the major determinants of dividend policy in the Fast-Moving Consumer Goods (FMCG) sector in India. It also seeks to review and analyse the findings of previous studies on the determinants of dividend policy and compare the findings of global studies with studies on FMCG sector. The study uses a descriptive research approach and is based on secondary data collected from previously published research papers and other relevant academic literature. The review of previous studies indicates that several financial factors influence dividend policy, including profitability, earnings per share, firm size, liquidity, leverage, growth opportunities, retained earnings, cash flows, and past dividend payments. The Indian studies on FMCG suggest that profitability, earnings per share, dividend payout ratio, and retained earnings influences dividend decisions. Other studies indicate that firm size, investment opportunities, business risk, and financial leverage influences dividend payments. Global studies also highlight the importance of profitability, firm size, ownership structure, and past dividend decisions.