The Role of Multiple Large Shareholders in Dividend Payouts: Evidence from India

This study examines the impact of multiple large shareholders (MLS) on a firm’s dividend payouts in low-investor protection regime, India, where minority shareholders’ expropriation concerns are severe and firms have an incentive to build capital market reputation. Therefore, we purport for prevalence substitution hypothesis, whereby MLS cooperate paying larger dividends assuage reputation-building. The empirical analysis using non-financial with listed NIFTY 500 from 2009 2019 yields that both controlling owner positively influence payout intensity. Additional analyses also demonstrate positive effect is prominent growing undertake equity issuances lower board independence. We find make relatively when institutional investor second largest shareholder. Further, it shown engage greater smoothing. Lastly, observed more valuable higher ownership. Altogether, these findings support hypothesis.