An appraisal of the Dividend Policy of Atlas Bangladesh Limited

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Presentation transcript:

An appraisal of the Dividend Policy of Atlas Bangladesh Limited

Mohammad Moin Alam 2007-2-10-161 (sec: 1). Asifur Rahman Mohammad Moin Alam 2007-2-10-161 (sec: 1) Asifur Rahman 2007-2-10-135 (sec: 3) Aisha Siddika Laboni 2007-2-10-124 (sec: 1) Fatema Khanom 2009-1-10-095 (sec: 3) Jason Rubel Das (sec: 3) 2007-2-10-152 Syed Asif Aziz 2006-2-10-207 (sec: 3)

Background An enterprise of Bangladesh Steel & Engineering Corporation. Established in 1966. Nationalized in 1972 . Initial Public Offered in 1987. public 49% , BSEC 51% Motorcycle (ranging from 50cc to 150cc) & 3- wheeler (Mishuk).

Theories of Dividend Policy Dividend irrelevance theory. Dividend relevance theory. “Bird in the Hand Theory”

Dividend Policy of Atlas Bangladesh limited. Year Net Income (millions) Growth (%) 2005 69.32 2006 71.79 3.56 2007 101.02 40.71 2008 96.89 -4.08 2009 n/a 2010 287.74 196.97

Dividend Policy of Atlas Bangladesh limited. Year EPS Growth (%) 2005 17.33 2006 11.97 -30.92 2007 12.63 5.51 2008 9.69 -23.27 2009 22.39 131.06 2010 21.58 -3.61

Dividend Policy of Atlas Bangladesh limited. Year EPS Dividend Per Share Dividend Payout Ratio 2005 17.33 100 5.77 2006 11.97 85 7.101 2007 12.63 120 9.501 2008 9.69 10.319 2009 22.39 75 3.349 2010 21.58 4.634

Dividend Policy of Atlas Bangladesh limited. Year Cash Dividend (%) 2005 100 2006 85 2007 120 2008 2009 75 2010

Dividend Policy of Atlas Bangladesh limited. Year Stock Dividend 2005 50 2006 33 2007 25 2008 n/a 2009 2010 33.33

Dividend Policy of Atlas Bangladesh limited. Year Cash Dividend Stock Dividend Percentage Dividend 2005 100 50 150% 2006 85 33 118% 2007 120 25 145% 2008 n/a 100% 2009 75 75% 2010 33.33 133.33

Findings Paid more than 100% cash dividend in 4 year. Also neglected stock dividend in 2 year Clearly not retaining any earning for expansion or development perfect example for the “BIRD IN THE HAND” theory.