TAILIEUCHUNG - Determinants of Dividend Payout Policy A Case of Nonfinancial Listed Companies in Vietnam
This research examines the determinants that affect the dividend payout ratio of 156 listed companies in the Vietnamese security market during 2009 and 2014. This study considered the influences of ten independent variables including free cash flow, sales growth, company size, financial leverage, profitability and liquidity. | VNU Journal of Science: Education Research, Vol. 32, No. 5E (2016) 12-22 Determinants of Dividend Payout Policy A Case of Nonfinancial Listed Companies in Vietnam Do Thi Van Trang* Banking Academy, Hanoi, Vietnam, No. 12, Chua Boc Str., Dong Da Dist., Hanoi, Vietnam Received 02 August 2016 Revised 26 September 2016; Accepted 22 December 2016 Abstract: This research examines the determinants that affect the dividend payout ratio of 156 listed companies in the Vietnamese security market during 2009 and 2014. This study considered the influences of ten independent variables including free cash flow, sales growth, company size, financial leverage, profitability and liquidity. The empirical results show that there are three factors having a significant relationship with the dividend payout ratio. Both the return on equity and the financial leverage variables are statistically and negatively significant with the dividend payout ratio; earnings per share are not clearly significant with the dividend payout ratio. Moreover, in the effect on the dividend payout ratio of the different industry sectors, the storage and food industry has a significant relationship with dividend payout ratio and three industries including the agricultural-forestry-fishery industry; mining industry; manufacturing industry statistically have dividend payout ratios higher than other industries. Keywords: Payout policy, dividend payout ratio, fixed effect model, random effect model. 1. Introduction * ways to create attractiveness for both domestic and international investors. Dividend policy decides to distribute the enterprise’s profit in which a business makes the choice whether to use earnings after tax to reinvest or to pay out dividends to shareholders. In terms of corporations, profit after tax is considered as the lowest cost funding source. It is kept to support capital for the company in reinvesting, expanding scale, and approaching a larger project for the development of .
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