




































 

 

 
8 

† Corresponding author  
© 2015 Conscientia Beam. All Rights Reserved. 

 

THE IMPACT OF DIVIDEND POLICY ON SHAREHOLDERS’ WEALTH 

BEFORE AND AFTER FINANCIAL MELT DOWN: EVIDENCE FROM FMCG 

SECTOR IN INDIA 

 

Sandanam GejaLakshmi1† --- Ramachandran Azhagaiah2 
1Ph.D Research Scholar, Kanchi Mamunivar Centre for PG Studies, (Autonomous “A” Grade Centre with Potential for Excellence by 

UGC), (Government of Puducherry) Pondicherry University, Puducherry, India      

2Associate Professor of Commerce, Kanchi Mamunivar Centre for PG Studies, (Autonomous “A” Grade Centre with Potential for 

Excellence by UGC), (Government of Puducherry) Pondicherry University, Puducherry, India 

 

ABSTRACT 

Dividend policy (DP) of corporate sector is widely researched topic in finance however; it remains a debatable issue to decide what 

factors determine the DP. The objective of this paper is to analyze the impact of dividend policy (DP) on shareholders’ wealth (SW) of 

Fast Moving Consumer Goods (FMCG) sector in India. Out of 16 firms listed on National Stock Exchange (NSE) 13 firms that 

have been paying dividend consecutively for the past ten years are considered for analysis. In the light of the prior literature, key 

predictor variables such as earnings per share (EPS), dividends per share (DPS), retained earnings per share (RPS), price earnings 

ratio (PER), lagged price earning (LAGPER), earnings (EAR), and lagged market value (LAGMPS) are considered for analyzing 

the impact of DP on SW. The descriptive statistics reveals that the data form in to normal.  Whereas when the assumptions needed to 

be fulfilled for the Ordinary Least Square method (OLS), the data are found to be homoskedastic and are free of autocorrelation. 

Augmented Dickey Fuller Test (ADF), White - Heteroskedasticity Test, Auto Correlation, Breuch-Godfrey Serial correlation LM test, 

Durbin-Watson, Lagrange Multiplier (LM) for Autoregressive conditional heteroskedasticity (ARCH-LM), Correlation, Ordinary 

Least Square Regression and Chow test are applied using Eviews 7 Econometrics software package for analysis. Regression result 

proves that DPS (121.65) and RPS (9.68) have significant positive co-efficient on EPS(SW) of FMCG firms in India before 

global financial melt down, while DPS (76.74), LAGPER (1.52) and LAGMPS (0.27) have significant positive co-efficient 

(76.74) on EPS(SW) of FMCG firms in India after global financial melt down. The results of the Chow test proves that the 

FMCG firms have significant shift-in-structure (positive improvement) in respect of SW after global financial melt down. 

Keywords: Dividend per share (DPS), Dividend policy (DP), Market price per share (MPS), Price earnings ratio 

(PER), Earnings per share (EPS),  Shareholders’ wealth (SW). 

JEL Classification: G 35, L 25. 

 

 

Financial Risk and Management Reviews 
2015 Vol. 1, No. 1 pp. 8-26 
ISSN(e): 2411-6408 
ISSN(p): 2412-3404 
DOI: 10.18488/journal.89/2015.1.1/89.1.8.26 
© 2015 Conscientia Beam. All Rights Reserved. 

 

http://crossmark.crossref.org/dialog/?doi=10.18488/journal.89/2015.1.1/89.1.8.26


Financial Risk and Management Reviews, 2015, 1(1):8-26 
 

 
9 

© 2015 Conscientia Beam. All Rights Reserved. 

Contribution/ Originality 

The study used new estimation methodology such as Augmented Dickey Fuller Test, White - 

Heteroskedasticity Test, Auto correlation, Breuch-Godfrey Serial correlation LM test, Durbin-Watson and 

ARCH-LM test and Chow test for analysis. Very few studies, which have investigated the impact of 

DP on SW before and after financial melt down studied the structural changes. However, the 

present study proved that the DP is significantly and positively related to retained earnings per 

share and earnings per share (SW).  The result of the study is consistent with the findings of Gul et 

al. (2012), Salman (2013), Bawa and Kaur (2013), Azhagaiah and Sabaripriya (2008), etc.  

 

1. INTRODUCTION 

Dividend policy (DP) is one of the three major decisions of financial management. The 

decision of the firm regarding the extent of earnings that could be paid as dividend and the extent 

that of could be retained by the firm is the concern of DP. In other words, the DP determines 

what proportion of earnings is to be paid to shareholders by way of dividends and what 

proportion is ploughed back in the firm itself for its reinvestment purposes. The development of 

such a policy will be greatly influenced by investment opportunities available to the firm and the 

value of dividends as against capital gains to the shareholders. Each firm should develop such a 

DP, which divides the net earnings in to dividends and retained earnings in an optimum way to 

achieve the objective of maximizing the shareholders’ wealth (SW) as it is represented by market 

price (MP) of the firm’s common stock which, in turn, is the function of the firm’s investment, 

financing and dividend decision.   

For studying the impact of DP on (SW), we have selected Fast Moving Consumer Goods 

(FMCG) sector, which is popularly known as consumer packaged goods sector. Items in this 

category include all consumables (other than groceries / pulses) that people buy at regular 

intervals. The most common products in the list are toilet soaps, detergents, shampoos, 

toothpaste, shaving products, shoe polish, packaged foodstuff, and household accessories and the 

list extends to certain electronic goods also.  

 

1.1. FMCG Sector in India 

The Indian FMCG sector is the fourth largest sector in the country with a total market size in 

excess of US$ 13.1 billion. It has a strong multinational companies (MNC) presence and is 

characterized by a well established distribution network, intense competition between the 

organized and unorganized segments and low operational cost. Availability of key raw materials, 

cheaper labour costs and presence across the entire value chain gives India a competitive 

advantage. The FMCG sector is flooded by firms from India and abroad and in future, the level of 

competition would increase further.  Moreover the GDP in Indian economy is increasing every 

year therefore per capita income increases and hence there is a scope for further development.  At 



Financial Risk and Management Reviews, 2015, 1(1):8-26 
 

 
10 

© 2015 Conscientia Beam. All Rights Reserved. 

present large and small firms are operating in Indian FMCG sector.  For the study purpose 13 

firms are selected which, are listed on NSE.  The FMCG market is set to treble from US$ 11.6 

billion in 2003 to US$ 33.4 billion in 2015. (Source: Building business leadership / Confederation of 

Indian industry). 

 

 

Figure-A. India : Gross domestic product (GDP) growth rate from 2004 to 2014 ( in percentage) 

                        Source: IMF Statista 2014 

 

Figure – A  depicts the real gross domestic product’s (GDP) growth  rate from 2004 to 2014.  

The GDP rate has decined to 6.9% during the period of global financial melt down  i.e. during 

2008 - 09. So, the study attempts to find out the shift-in-structure in terms of DP on SW .  For 

this purpose, the period of the study is divided into two sub-periods viz., before financial melt 

down i.e., from 2003 – 2007 and after global financial melt down i.e., from 2009 – 2013. 

 

1.2. Industry - Wise Impact 

Figure – B depicts the industry wise impact of global financial melt down. It is inferred that 

almost all key industries in India have been negatively impacted by global financial melt down 

and the FMCG sector is of no exception. In that, FMCG firms have registered an average growth 

score i.e. 21, which indicates moderate impact of global financial melt down. 



Financial Risk and Management Reviews, 2015, 1(1):8-26 
 

 
11 

© 2015 Conscientia Beam. All Rights Reserved. 

 
Figure-B. Industry wise impact on global financial melt down chart during the year 2008 (  in crore) 

     Source: Cartesian Economic Meltdown survey, December 2008. 

 

An impact score of 0 – 15 indicates low impact  

An impact score of 16 – 50 indicates moderate impact 

An impact score of more than 50 indicates high impact 

Hence, the present paper is to analyze the financial data of 13 FMCG firms for the financial 

data pertaining to the years ranging from 2003 - 2007 for before global financial melt down and 

from 2009 – 2013 for after global financial melt down, which are selected based on multi - stage 

non-random sampling technique, focusing on estimating the impact of financial variables viz., 

DPS, RPS, PER, LAGPER, EAR, LAGMPS on SW (EPS) of FMCG sector in India. 

 

2. REVIEW OF LITERATURE 

Several studies were made in relation to dividend policy (DP) and shareholders’ wealth (SW) 

in the developed as well as in the developing countries. Olandipupo and Okafor (2011), Devaki 

and Kamalaveni (2012), Gul et al. (2012), Onwumere et al. (2012), Salman (2013), Bawa and Kaur 

(2013), Azhagaiah and Sabaripriya (2008), Tahir and Raja (2014), Atiyet (2012), Chidinma et al. 

(2013), Kumaresan (2014), Uwuigbe et al. (2012) and Parua and Gupta (2009) investigated the 

impact of DP on SW applying OLS method of regression.  Azhagaiah and Veeramuthu (2010) 

analysed the impact of firm size on dividend behavior with the help of Chow-test. Rafique (2012) 

examined the factors affecting DP using multiple regression and the study found that DP has 

significantly influenced SW. 

Researchers have used regression, independent sample t-test, correlation, Granger Causality Test, 

ADF, and White - Heteroskedasticity Test to study the impact of the DP on SW.  

Olandipupo and Okafor (2011), in their research work titled “Control of share wealth 

maximization in Nigeria” focused on parties controlling shareholders’ wealth maximization and 

the ways it affects the firm’s performance.  The data used for the study were collected from the 

Nigerian stock exchange and the annual reports of six sample firms from food / tobacco and 

67

50

40
34 34 33 31

23 21 21 17
11 9

0

10

20

30

40

50

60

70

80

In
 

Sector 



Financial Risk and Management Reviews, 2015, 1(1):8-26 
 

 
12 

© 2015 Conscientia Beam. All Rights Reserved. 

subsector for 20 years. The data collected were analyzed using ordinary least square (OLS) 

regression, autocorrelation and auto regression.  The study showed that all the predictor 

variables provided good explanation.  The firm size (FS) and retained earnings (RE) had positive 

relationship and their impact was proved statistically significant on the shareholders’ fund, while 

dividend payment had negative relationship with the SW.  However, turnover and retained earnings 

were of more significance in controlling the shareholders’ wealth than the dividend payout.   

Devaki and Kamalaveni (2012), in their paper titled “Shareholding patterns and dividend payout: 

An empirical analysis in Indian corporate hotels” examined the influence of shareholding pattern of 

the Indian corporate hotels.  Data were collected from 152 Indian firms (both listed and unlisted) 

in hotel industry from the electronic corporate database called CMIE and CAPTALINE database.  

Fixed effect firm model estimation revealed that there was a positive association between lagged 

dividend, earnings, debt-equity ratio, sales size, age of the firm and institutional shareholding. 

Gul et al. (2012),in their study titled “The relationship between dividend policy and shareholders’ 

wealth” examined the influence of DP on SW of 75 listed firms in Karachi stock exchange.  Data 

were collected from annual reports of the firms, Karachi stock market and State Bank of Pakistan. 

Descriptive statistics, multiple regression and stepwise regression methods were used to study the 

impact of DP on SW.  The study found that the difference in average market value relative to 

book value of equity was highly significant for dividend paying firms and dividend non-paying 

firms. Lagged market value of equity had a significant impact on the market price per share; however, 

retained earnings had insignificant influence on the market price of equityas far as the dividend 

paying firms are concerned and there was a significant influence of DP on SW.   

Onwumere et al. (2012), in a research paper titled “Does the use of outsiders fund enhance 

shareholders’ wealth: Evidence from Nigeria” attempted to study the links between the firms’ 

financial structure and the objective of the firms in maximizing shareholders’ wealth.   The study 

relied on historic accounting data obtained from the financial statements and accounts of 28 firms 

in the Nigerian stock exchange.  The study examined the impact of outsiders’ fund on the firms’ 

SW maximization using three value maximization indicators viz., net profit margin, dividend per 

share and current ratio.  The study revealed that outsiders’ fund was positive and did not have 

significant impact on the dividend per share and current ratio; outsiders’ fundhadnegative and 

significant impact on the net profit margin. 

Salman (2013) examined the “Effect of DP on SW of sugar industry in Pakistan” considering a 

sample of 33 listed firms of sugar industry listed on Karachi Stock Exchange. The data were 

collected for a period of six years ranging from 2006 to 2011.  Descriptive statistics and 

regression analysis were applied for analysis considering dividend per share (DPS), earnings per 

share(EPS), lagged market price per share (MPS), price earnings ratio (PER), and retained earnings 

(RE) as predictor variables and market price per share (MPS) as response variable.  The study showed 

that DPS, EPS, Lagged MPS, and Lagged PER had significant positive relationship with SW.  



Financial Risk and Management Reviews, 2015, 1(1):8-26 
 

 
13 

© 2015 Conscientia Beam. All Rights Reserved. 

Bawa and Kaur (2013), in a research work titled “Impact of dividend policy on shareholders’ 

wealth: An empirical analysis of Indian information technology sector” selected 308  firms , which have 

listing flag in National stock exchange and Bombay stock exchange with the objective to study 

the impact of DP on SW. Variables, viz., dividend per share (DPS),retained earnings per share 

(REPS), lagged price earnings ratio (LAGPER) and lagged market price per share (LAGMPS) were 

considered as predictor variables and market price per share (MPS) was considered as response 

variable. Panel data methodology was applied to study the impact of DP on market value of equity. 

The results showed that in the long run, shareholders’ wealth of dividend paying IT firms had 

increased significantly when compared to the non-dividend paying IT firms. 

Azhagaiah and Sabaripriya (2008),in their study titled “The impact of dividend policy on 

shareholders’ wealth” analyzed the impact of DP on shareholders’ wealth in organic and in-organic 

chemical firms in India with a sample of 28 firms selected from 114 listed firms on BSE using 

multi stage non - random sampling technique.  They used mean, standard deviation multiple 

regression and stepwise regression techniques to ascertain the best fitted model for predicting the DP 

and studying its impact on SW.  The study  proved that the wealth of the shareholders’ was 

greatly influenced mainly by five variables viz., growth in sales, improvement of profit margin, capital 

investment decision, capital structure decision and cost of capital.  There was a significant impact of DP 

on SW in organic chemical firms, while the SW was not influenced by dividend payout as far as 

the organic chemical firms are concerned. 

Tahir and Raja (2014), in their study titled “Impact of dividend policy on shareholders’ wealth” of 

oil and gas exploration firms of Pakistan during the years from 1999 to 2006 used regression and 

correlation to ascertain the best fitted model for the DP and to study its impact on SW. The 

variables viz., dividend payout ratio (DPR), price earnings ratio (PER) and book value to market value 

of equity (BV/MV) ratio were considered as predictor variables and holding period yield as response 

variable. The result showed a correlation between predictor variables and response variable for all 

the firms.  Oil and gas industry of Pakistan paid dividend on regular basis but there was 

uncertainty in stock market due to which holding period returns were not efficient because share 

price of firms were not stable and fluctuation took place in firms and the study proved that 

dividend payout ratio had insignificant relationship with holding period yield. 

Atiyet (2012), in a study titled “The impact of financing decision on the shareholder value creation” 

covered 88 firms listed on French stock exchange. Shareholders’ wealth creation was a response 

variable while equity issue, debt, growth rate, profitability, investment opportunities, and size were 

considered as predictor variables. Statistical tools like regression and correlation were used to 

ascertain the best fitted model for the impact of financing decision on shareholders’ value creation. 

The result showed that growth, profitability, financial debt and size of the firm had significant impact 

on shareholders’ wealth. 



Financial Risk and Management Reviews, 2015, 1(1):8-26 
 

 
14 

© 2015 Conscientia Beam. All Rights Reserved. 

Chidinma et al. (2013),in their study titled “Shareholders’ value and firms’ dividend policy: 

Evidence from public firms on Nigeria stock exchange” used secondary data of 216 public limited firms 

listed on Nigerian stock exchange for the period of 2000-2011. Dividend per share (DPS) was 

considered as response variable, while earnings per share (EPS) and market price per share (MPS) 

were considered as predictor variables. The study found that earnings per share and market price per 

share had significant impact on SW; a high dividend payout increases the market value of shares 

and thus, the shareholders’ value.  

Kumaresan (2014), in a study titled “Impact of dividend policy on shareholders’ wealth: A study of 

listed firms in hotels and travels sector of Sri Lanka” focused on top ten firms under hotel and travel 

sectors in Sri Lanka during the period from 2008 to 2012. Shareholders’ wealth (EPS) was 

considered as response variable while predictor variables were: return on equity (ROE), dividend 

payout ratio (DPR), dividend per share (DPS) and retention ratio (RR). The study used correlation 

and regression to analyse the data collected from top ten listed firms under hotel and travel 

sectors. The study found that there was a positive relationship between return on equity (ROE), 

dividend per share (DPS) and dividend payout ratio (DPO) and shareholders’ wealth (SW) of the 

selected firms under hotel and travel sectors in Sri Lanka and the study also proved that there 

was a negative relationship between retention ratio and shareholders’ wealth. 

Uwuigbe et al. (2012) studied the relationship between financial performance and dividend 

payout among the listed firms in Nigeria for a period of five years i.e. 2005-2010 and found that 

there was a significant positive association between the performance offirms and the dividend 

payout;ownership structure and firm’s size on dividend payout of the firms. 

Rafique (2012) examined the “ Factors affecting the dividend payout of listed non-financial firms of 

Karachi Stock Exchange ” with a sample of 53 firms listed as non – financial firms on the Karachi 

stock exchange for the period 2005-2010. The data were found to be Homoskedastic and free of auto 

correlation and the regression results revealed that corporate tax (CT) and firms’ size (FS) had 

significant relationship with DP of firms.  

Azhagaiah and Veeramuthu (2010) examined the association between corporate leverage and 

DP of the firms across sectors in India on panel data of 73 firms for a period 1996-2007. The 

study proved that there was a significant impact of selected predictor variables on dividend behavior; 

the DP of small size, medium size and large size firms and overall corporate firms across sectors 

in India was dependent on the debt – equity ratio. 

 

2.1. Objectives and Hypotheses Development for the Study 

The main objective of the study is to empirically analyze the impact of dividend policy on 

shareholders’ wealth. The following are the specific objectives of the study: 

 To study the relationship between dividend policy and shareholders’ wealth of 

FMCG sector in India before financial melt down and after financial melt down. 



Financial Risk and Management Reviews, 2015, 1(1):8-26 
 

 
15 

© 2015 Conscientia Beam. All Rights Reserved. 

 To analyze the variation in studying the impact of selected variables (DPS, RPS, 

EAR, PER, LAGPER, LAGMPS) on the SW (EPS) of FMCG sector in India. 

 

2.2. The Following are the Hypotheses Developed for the Study 

H0
1: “There is no significant impact of dividend per share (DPS) on earnings per share (EPS) 

(SW) before global financial melt down”. 

H0
2: “There is no significant impact of retained earnings per share (RPS) on earnings per share 

(EPS) (SW )before global financial melt down”. 

H0
3: “There is no significant impact of dividend per share (DPS)on earnings per share (EPS) (SW) 

after global financial melt down”. 

H0
4: “There is no significant impact of lagged price earning ratio (LAGPER) on earnings per 

share (EPS) (SW) after global financial melt down”. 

H0
5: “There is no significant impact of lagged market price per share (LAGMPS) on earnings per 

share (EPS) (SW) after global financial melt down”. 

H0
6: “There is no significant shift in structure in the shareholders’ wealth (SW) of FMCG sector 

in India after global financial melt down”. 

 

3. RESEARCH METHODOLOGY 

3.1. Data Source 

The study is analytical and empirical in nature and is based on secondary data. For the study, 

a sample of 13 FMCG firms listed on NSE has been selected using multi stage non-random sampling 

technique. The period of the study has been divided into two sub-periods viz., before global 

financial melt down i.e., from 2003-2007 and after global financial melt down i.e., from 2009-2013. 

The global financial melt down occurred during the year 2008 is considered as the base for the 

study to analyze the impact of DP on SW. The required data were collected from the website 

called moneycontrol.com and the annual reports of the FMCG firms concerned too. The annual data 

for the selected FMCG firms are used for calculating key financial ratios (measures) to analyze the 

impact of DP on SW. 

 

3.2. Research Methods 

Various statistical methods like Augmented Dickey Fuller Test, White - Heteroskedasticity Test, 

Auto Correlation, Breuch-Godfrey Serial correlation LM test, Lagrange Multiplier (LM) for 

Autoregressive conditional heteroskedasticity, Correlation, Ordinary Least Square method of 

regression and Chow test  are applied  for analysis of data using Eviews 7 Econometrics software 

package . 

For the analysis of pooled data for ten years i.e. from 2003 – 2007 and 2009-2013, the 

following research methods are used. 



Financial Risk and Management Reviews, 2015, 1(1):8-26 
 

 
16 

© 2015 Conscientia Beam. All Rights Reserved. 

 Descriptive Statistics (Jarque-Bera test) 

 Correlation  

 Ordinary Least Square regression method 

 Augmented Dickey Fuller Test, White - Heteroskedasticity Test, Auto correlation, Breuch-

Godfrey Serial correlation LM test, Durbin-Watson and ARCH-LM test and  

 Chow test 

General form of the Regression Model 

EPS = β1 (DPS) + β2 (RPS) + β3 (PER) + β4 (LAGPER) + β5 (EAR) +  β6 (LAGMPS) + e 
……..(i) 

    Earnings per share (EPS), Dividend per share (DPS), Retained earnings per share (RPS), Price earnings ratio (PER), Lagged price 

earnings  ratio (LAGPER), Earnings (EAR), Lagged market price per share (LAGMPS). 

 

3.3. Chow Test 

The shift-in structure in terms of DP on  SW is studied with the help of chow test, which  

(Chow, 1960) was originally designed to analyse the same variables obtained in two different data 

sets to determine if they were similar enough to be pooled together.  The method, however, could 

be used to determine if two regression lines are different from one another (Lee, 2008). The chow 

test for parameter stability confirms that there was a structural change in the equation.  The 

chow test models indicate that for all the series under examination, the null hypothesis of more 

than one structural break time can be rejected (Allaro et al., 2011). 

The impact of DP on SW is studied through its structural changes. For this purpose, the 

period of study has been divided in to two sub-periods viz., before global financial melt down i.e., 

from 2003 – 2007 and after global financial melt down i.e., from 2009 – 2013.  

The test statistic is as follows: 

 

This is distributed as F with k and n1 + n2 – 2k degrees of freedom 

Where, F is the test statistic 

RSS p        =   residual sum of squares for the whole sample  

RSS1         =     residual sum of squares for the first group (before dividend announcement) 

RSS2         =     residual sum of squares for the second group (after dividend announcement) 

N           =   number of observations 

K =    number of regressors (including the intercept term) in each unrestricted sub-sample 

2K =    number of regressors in both unrestricted sub-sample regressions (whole sample) 

 

 

 

 



Financial Risk and Management Reviews, 2015, 1(1):8-26 
 

 
17 

© 2015 Conscientia Beam. All Rights Reserved. 

3.4. Sampling Technique 

The study used multistage non-random sampling technique to select the ultimate sample units.  

Out of 16 firms having listing flag on NSE, 13 firms are selected based on adequate availability of 

data for the study period.  

 

Table-1. List of Measures (ratios) Used in the Study for Analysis 

Sl. 
No. 

Variable / 
Measure 

Formula Inference 

1 
Earnings per 
share (EPS) 

Net income / 
Number of equity 
shares 

It represents the capacity of firm to pay 
dividends.  Firm is willing to pay high 
dividend if it increases profitability. 

2 
Dividend per 
share (DPS) 

Total dividend / 
No. of  equity 
shares outstanding 

The dividend per share reveals how well 
earnings support the dividend payout.  

3 
Retained 
earnings per 
share (REPS) 

Retained earnings / 
No. of  equity 
shares outstanding 

A firm with growth in its retained 
earnings can use the additional earnings to 
expand its business, which can potentially 
lead to high profits and increase the firm’s 
value. 

4 
Price 
earnings 
ratio (PER) 

Market value per 
share / Earnings 
per share 

High price earnings ratio indicates that 
investors anticipate high growth in future. 

5 
Earnings 
(EAR) 

Total revenue – 
Total expenses 

Higher the earnings, larger the cash flow 
and therefore, firms will pay high 
dividend.   

6 
Market price 
per share 
(MPS) 

Market 
capitalization / No. 
of equity shares 
outstanding 

High market value reflects that the firms 
are in very good position and lower value 
reflects otherwise. 

           Source: www.scibd.com/essays/finance.php 

           Source:www.ukessays.com/essays/finance/current-assets-current-liability.php 

  

Table 1 depicts the variables which were used to study the impact of dividend policy on 

shareholders’ wealth before and after financial melt down of the FMCG firms listed on BSE.  

Earnings per share (EPS) was considered as response variable, while dividend per share (DPS), 

retained earnings per share (REPS), price earnings ratio (PER), earnings (EAR) and lagged market 

price per share (LAGMPS) were considered as predictor variables.  

 

4. DESCRIPTIVE STATISTICS 

Table 2 shows the descriptive statistics of seven selected financial variables on dividend 

policy, which reveals that the data are normally distributed. The data set contained a total of 130 

observations of 13 firms over a period of ten years. The mean of all the selected seven variables is 

very much close to the median, implying normality.  The average DPS is0.09 i.e., 9% which 

means, on an average, the firms pay about 9% of their profit as dividend.  RPS shows an average 



Financial Risk and Management Reviews, 2015, 1(1):8-26 
 

 
18 

© 2015 Conscientia Beam. All Rights Reserved. 

of 2.02, which reflects a firm with growth in its RPS, which can lead to high profits and increase 

the shareholders’ wealth. EAR shows an average of 606.66. Higher earnings reflect that the firms 

have capacity to pay dividend. The average of PER and LAGPER is 21.61 and 20.14 respectively, 

which means that the investors anticipate high growth in future.  The average of EPS is 22.35, 

which reflects that the firms of FMCG sector have good earnings and capacity to pay dividend if 

it increases profitability. The average of LAGMV (388.50) reflects that the firms of FMCG sector 

are in very good position during the study period, which infers that the firms are potential and 

successful in DP in the long – run. 

The maximum and minimum values of the selected variables have more volatility for all 

except for EAR. The standard deviation of EAR is the highest (1051.61), whereas the lowest that 

of DPS is 0.08. All the selected variables are positively skewed except for PER. Probability of 

EAR is less than 1% level, implying that the selected variables are significant at 99% confidence 

interval.  DPS and RPS is less than 5% level, implying that the selected variables are significant 

at 95% confidence interval. 

 

Table-2. Descriptive Statistics of Selected Variables of FMCG firms in India from 2008 to 2012 

Variables DPS RPS PER LAGPER EAR LAGMV EPS 

Mean 0.09 2.02 21.61 21.60 606.66 388.50 22.35 

Median 0.08 1.47 21.41 20.14 230.76 223.09 21.06 
Maximum 0.24 7.32 35.14 46.53 3598.38 898.79 54.61 

Minimum 0.01 0.28 3.12 5.86 70.82 21.05 3.60 
Std. Dev. 0.08 1.98 9.95 10.71 1051.61 342.60 16.14 

Skewness 0.66 1.58 -0.31 0.73 2.207 0.30 0.70 
Kurtosis 2.19 4.63 2.07 3.35 6.36 1.36 2.37 

Jarque-Bera 1.36** 6.91** 0.68 1.23 16.67*** 1.65 1.28 
Probability 0.04 0.03 0.70 0.53 0.00 0.43 0.52 

N 13 13 13 13 13 13 13 

Dividend per share (DPS), Retained earnings per share (RPS), Price earnings ratio (PER), Lagged price earning ratio (LAGPER),  Earnings 

(EAR), Lagged market value (LAGMV), Earnings per share (EPS). 

Source: Computed results based on compiled data from the Annual Financial Reports of selected corporate firms from moneycontrol.com 

*** Significant at 1% level; ** Significant at 5% level 

 

 

Figure-C.  Jarque-Bera Test of Selected Variables of FMCG firms in India from 2008 to 2012 (  

in crore) Normality Test 

Source: Computed results based on compiled data from the Annual Financial Reports of the selected corporate 

firms moneycontrol.com 

0

1

2

3

4

5

-10.0 -7.5 -5.0 -2.5 0.0 2.5 5.0 7.5

Series: Residuals
Sample 1 13
Observations 13

Mean      -5.77e-15
Median  -0.722129
Maximum  5.547479
Minimum -7.891606
Std. Dev.   4.071651
Skewness  -0.288542
Kurtosis   2.166745

Jarque-Bera  0.556476
Probability  0.757117



Financial Risk and Management Reviews, 2015, 1(1):8-26 
 

 
19 

© 2015 Conscientia Beam. All Rights Reserved. 

Figure – C depicts normality test, which reveals that the data form normal distribution.  

Jarque-Bera test (0.56) is a goodness of fit, which is a measure of departure from normality, based 

on the sample of kurtosis and skewness.  So, the samples from a normal distribution have an 

expected skewness of -0.29 and an expected kurtosis of 2.17. 

 

 

Table-3. Results of Unit Root Test (Augmented Dickey-Fuller Test) 

Variables ADF(t-Statistic) Probability  

Earnings per share (EPS) -4.863297*** 0.0045 

Dividend per share (DPS) -4.484696*** 0.0077 

Retained earnings per share (REPS) -4.185369** 0.0137 

Price earning ratio (PER) -10.31925*** 0.0000 
Lagged price earning ratio (LAG 
PER) 

-6.475426*** 0.0001 

Earnings (PAT) -3.435427*** 0.0075 

Lagged market value  (LAGMV) -4.703563*** 0.0056 

Source: Computed results based on compiled data from the Annual Financial Reports of the Selected 

Corporate firms from moneycontrol.com 

*** Significant at 1% level; ** Significant at 5% level. 

 

Table 3 shows the presence of unit root in the series using Augmented Dickey-Fuller Test (ADF). 

The results show that there is a need for verifying whether the data are stationary by unit root 

test, hence it is conducted by Augmented Dickey-Fuller (ADF). 

 

 

The p values of ADF are less than 0.05, which infer that the data of the time series for the 

whole study period are stationary. The ADF test statistics report  that hypothesis of a unit root in 

the series is rejected at 1% level for EPS, DPS, PER, LAGPER, EAR and LAGMV (critical values 

-4.86, -4.48, -10.31, -6.48, -4.70 respectively) and at 5% for RPS (critical value of -4.19) for the 

ADF test. Therefore, the result of the test confirms that the data of the series are stationary. 

 

Table-4. Results of White - Heteroskedasticity Test 

F-Statistic 0.326 Probability 0.900 

Obs* R-Squared 3.196 Probability 0.783 

 Source: Computed results based on compiled data from the Annual Financial Reports 

from moneycontrol.com 

  



Financial Risk and Management Reviews, 2015, 1(1):8-26 
 

 
20 

© 2015 Conscientia Beam. All Rights Reserved. 

The condition of classic linear regression model (vide table 4) implies that there should be 

homoskedasticity between variables, which means that the spread should be constant and same. 

Variance of residuals should be constant otherwise, the condition for existence of regression, 

homoskedasticity would be violated and the data would be heteroskedastic. To check, white 

heteroskedasticity test is applied for the residuals, which reveals that the probability is more than 5%. 

Hence, it proves that there is absence of heteroskedasticity and the data have uniform spread. 

 

Table-5.Results of Breuch-Godfrey Serial correlation LM test 

F-Statistic 0.779 Probability 0.614 
Obs* R-Squared 5.696 Probability 0.458 

Source: Computed results based on compiled data from the Annual Financial Reports 

from the moneycontrol.com 

 

It is evident that there is no serial correlation (vide table 5). Hence, the null hypothesis is accepted, 

which infers that if an estimated regression line fulfills all the requirements of a good regression 

model it invites to move for further hypothesis testing or forecasting. The estimated regression 

has either no heteroskedascity or no serial correlation hence it leads to go for testing hypothesis 

by use of ARCH-LM model. 

 

Table-6. Results of ARCH-LM test 

F-Statistic 3.537 Probability 0.059 

Obs* R-Squared 3.135 Probability 0.056 

Source: Computed results based on compiled data from the Annual Financial Reports from 

moneycontrol.com 

 

6 shows the ARCH-LM test, (p< 0.05) and the null hypothesis is rejected at 5% level, which 

reveals that there is presence of ARCH effect in the residuals of simple time series models. 

 

5. CORRELATION ANALYSIS 

Table 7(a) shows the correlation matrix of selected variables; the relationship between EPS 

and RPS (0.837); that of between LAG MPS and EPS (0.751), which are highly significant 

positively at 1% level; whereas the relationship between EPS and DPS (0.617); and that of 

between EAR and PER (0.659); and that of between LAGMPS and LAGPER (0.585) are 

significant positively at 5% level.  

Table 7(b) shows the correlation matrix of selected variables, the relationship between EPS 

and DPS (0.924); that of between EPS and RPS (0.720); that of between LAGPER and PER 

(0.946) ; that of between LAGMPS and DPS( 0.706); that of between LAGMPS and RPS (0.876); 



Financial Risk and Management Reviews, 2015, 1(1):8-26 
 

 
21 

© 2015 Conscientia Beam. All Rights Reserved. 

and that of between LAGMPS and EPS (0.827) are highly significant positively at 1% level; 

whereas the relationship between DPS and RPS (0.594) is significant positively at 5% level. 

Table-7(a). Results of Correlation Analysis among the Predictor Variables of FMCG Firms in India from 2003 to 2007 (  

in crore) 

Variables DPS RPS PER EPS LAGPER 

EPS 

Pearson 
Correlation 0.617** 0.837 *** 

  

 

Sig. (2-tailed) 0.02 0.000 
  

 
N 13 13 

  
 

EAR 

Pearson 
Correlation 

  
0.659** 

 
 

Sig. (2-tailed) 
  

0.014 
 

 
N 

  
13 

 
 

LAGMPS 

Pearson 
Correlation 

   
0.751*** 0.585** 

Sig. (2-tailed) 
   

0.003 0.036 
N 

   
13 13 

Earnings per share (EPS), Earnings (EAR), Lagged market price per share (LAGMPs), Dividend per share (DPS), Retained 

earnings per share (RPS), Price earning ratio (PER), Lagged price earning ratio (LAGPER).  

Source: Computed results based on compiled data from the Annual Financial Reports from moneycontrol.com 

*** Significant at 1% level; ** Significant at 5% level. 

 

Table-7(b). Results of Correlation Analysis among the Predictor Variables of FMCG Firms in India from 2009 to 2013 (  

in crore) 

Variables DPS RPS PER EPS 

EPS 

Pearson 
Correlation 0.924***  0.720 *** 

 

  

Sig. (2-tailed) 0.00 0.00 
 

  
N 13 13  

 
  

DPS 

Pearson 
Correlation 

 
0.594** 

  Sig. (2-tailed) 
 

0.032 
  N 

 
13 

  

LAGPER 

Pearson 
Correlation 

  
0.946*** 

 Sig. (2-tailed) 
  

0.00 
 N 

  
13 

 

LAGMPS 

Pearson 
Correlation 0.706*** 0.876*** 

 
0.827*** 

Sig. (2-tailed) 0.007 0.000 
 

0.00 
N 13 13 

 
13 

Earnings per share (EPS), Dividend per share (DPS), Lagged price earnings ratio (LAGPER), Lagged market 

price per share (LAGMPS), Retained earnings per share (RPS), Price earnings ratio (PER).  

Source: Computed results based on compiled data from the Annual Financial Reports from moneycontrol.com  

*** Significant at 1% level; ** Significant at 5% level. 



Financial Risk and Management Reviews, 2015, 1(1):8-26 
 

 
22 

© 2015 Conscientia Beam. All Rights Reserved. 

5.1. Impact of Dividend Policy on Shareholders’ Wealth - Regression Analysis 

 

Table-8. Results of Multiple Regression of Selected Variables of Dividend Policy on Shareholders’ Wealth of FMCG 

firms in India for the period Before Global Financial Melt down (2003 -2007) and After Global Financial Melt down (2009 

– 2013) periods 

Variables 
  
  

Unstandardized coefficients beta value 

Before Global financial melt down After Global financial melt down 

Β t-Value P- Value β t-Value P- Value 

Constant ( EPS) -10.91 -1.39 0.212 18.41 2.59** 0.04 

DPS 121.65 2.55** 0.03 76.74 2.25** 0.04 
RPS 9.68 4.13*** 0.006 0.42 0.27 0.79 

PER 0.024 0.098 0.925 0.79 1.56 0.16 

LAGPER 0.16 0.447 0.671 1.52 2.05** 0.05 
EAR 0.005 0.955 0.377 0.001 0.39 0.707 

LAGMPS 0.006 0.208 0.842 0.27** 2.73 0.03 
Adjusted R2 0.889 0.96 

R2 0.94 0.98 
F Statistics 16.680*** (0.002) 25.19***(0.001) 

Degrees of Freedom 6,58 6,58 
Number of observations  65 65 
Earnings per share (EPS), Dividend per share (DPS), Retained earnings per share (RPS), Price earning ratio (PER), Lagged price earning 
ratio (LAGPER), Earnings (EAR),Lagged market price per share (LAGMPS).  
Source: Computed results based on compiled data from the Annual Financial Reports from moneycontrol.com 
*** Significant at 1% level; ** Significant at 5% level. 

 

The impact of DP on SW of IT sector has been analyzed using multiple regression analysis.  

The dividend per share (DPS) has been used as proxy for measuring the DP of the firms and 

earnings per share (EPS) of the firms is considered as proxy for measuring the SW and is used as 

response variable. Apart from DPS, retained earnings per share (RPS), earnings (EAR), price 

earnings ratio (PER), lagged price-earnings ratio (LAGPER) and lagged market price per share 

(LAGMPS) are also used as predictor variables to study whether DP of FMCG firms has 

impacted the SW.  The results of the regression analysis are presented in table 8. 

The DPS has significant positive co-efficient (121.65) on EPS (SW) for the period before 

global financial melt down in India. Hence, H0
1: “there is no significant impact of DPS on EPS 

(SW) before global financial melt down” is rejected at 5% level. RPS has significant positive co-

efficient (9.68) on EPS (SW) before global financial melt down in India.  Hence, H0
2: “there is no 

significant impact of RPS on EPS (SW) before financial melt down” is rejected at 5% level.  [The 

F- statistics (16.680) is significant at 1% level with R² (0.94); Adj R² (0.88)]. 

 

The Regression Results are as Follows (Before Global Financial Melt Down) 

EPS = β1 (DPS) + β2 (RPS) + β3 (PER) + β4 (LAGPER) + β5 (EAR) + β6 (LAGMPS) + 
e 
(-1.39)(2.55) **(4.13) ***   (0.098)             (0.447)            (0.955)             (0.208) 

Figures in parentheses denote t- value 

*** Significant at 1% level; ** Significant at 5% level. 

The regression equation infers that there is a significant positive impact of DPS and RPS on EPS (SW) before financial melt down. 



Financial Risk and Management Reviews, 2015, 1(1):8-26 
 

 
23 

© 2015 Conscientia Beam. All Rights Reserved. 

The DPS has significant positive co-efficient (76.74) on EPS (SW) of FMCG firms after 

global financial melt down in India (vide table 8). Hence, H0
3:“there is no significant impact of DPS 

on EPS (SW) of FMCG firms after financial melt down” is rejected at 5% level. LAGPER has 

significant positive co-efficient (1.52) on EPS (SW) of FMCG firms after global financial melt 

down in India.  Hence, H0
4: “there is no significant impact of LAGPER on EPS (SW) of FMCG 

firms after global financial melt down” is rejected at 5% level.  LAGMPS has significant positive 

co-efficient (0.27) on EPS (SW) of FMCG firms after global financial melt down in India.  Hence, 

H0
5: “there is no significant impact of LAGMPS on EPS (SW) of FMCG firms after global 

financial melt down” is rejected at 5% level. [The F- statistics is (25.19) at 1% level with R² 

(0.98); Adj R² (0.96)]. 

 

The regression results are as follows (After Global Financial Melt down) 

EPS =     β1 (DPS) + β2 (RPS) + β3 (PER) + β4 (LAGPER) + β5(EAR) + β6(LAGMPS) 
+ e 
(2.59)**(2.25) **(0.27)          (1.56)             (2.05)**          (0.39)               (2.73) 

Figures in parentheses denote t- value 

** Significant at 5% level 

 

The regression equation infers that there is a significant positive impact of DPS, LAGPER and 

LAGMPS on EPS (SW) after global financial melt down. 

 

5.2. Testing of Structural Shift – Application of Chow Test 

 

Table-9.Results of Chow test for Structural shift in Dividend Policy on Shareholders’ Wealth between before Global 

financial melt down (2003 – 2007) and after Global financial melt down (2009 – 2013) of FMCG firms in India 

Whole 
sample 

Sum of square residuals 

Number of 
Parameter
s 
Estimated 

Number 
of 
Observati
ons F-Value DF F - limit 

Before 
Global 
financial 
melt down 

After 
Global 
financial 
melt down  

662.976 326.928 232.406 7 130 3.07*** 7,  116 
F0.01   2.79 
(for V1 = 7; V2 = 116) 

Source: Computed results based on compiled data from the Annual Financial Reports from moneycontrol.com 

*** Significant at 1% level. F – limit  for 7,116 degrees of freedom at 1% level is 2.79. 

  

The result of chow test (vide table 9) reveals that the F-value (3.07 0.01) is greater than the F 

limit (2.79) at 1% level for df. 7, and 116, hence, H0
6: “there is no significant shift in structure in 

the shareholders’ wealth of FMCG sector in India after global financial melt down” is rejected 1% 

level, which implies that the FMCG firms have a significant shift -in-structure (improvement 

positively) in respect of DP on SW after global financial melt down at 1 % level. 

 



Financial Risk and Management Reviews, 2015, 1(1):8-26 
 

 
24 

© 2015 Conscientia Beam. All Rights Reserved. 

6. CONCLUDING REMARKS 

This paper is an effort to reveal the insight dynamics for the impact of dividend policy on 

shareholders’ wealth: Evidence from FMCG sector in India considering global financial melt down as 

an event.  In the light of the previous literature, key explanatory variables were found to disclose 

the relationship and the impact of DP on SW.  The response variable i. e. earnings per share 

(EPS) is considered as proxy for measuring the shareholders’ wealth. Dividend per share (DPS), 

retained earnings per share (RPS), price earnings ratio (PER), lagged price earning (LAGPER), earnings 

(EAR), and lagged market value (LAGMPS) are considered as predictor variables. Out of 16 listed 

firms on NSE,13 firms are selected using multi stage non-random sampling technique based on the 

availability of data.  

Regression analysis is used as the most appropriate tool for analysis of data. The shift-in-

structure in terms of DP on SW considering the event i.e. global financial melt down is studied 

with the help of Chow test.   Descriptive statistics revealed that the data are normal whereas when 

the assumptions needed to be fulfilled for ordinary least square (OLS) are tested, the data were 

found to be homoskedastic and free of auto correlation.  

Correlation results revealed the relationship between EPS and RPS (0.837); that of between 

LAGMPSand EPS(0.751) which are highly significant positively at 1% level; whereas the 

relationship between EPS and DPS (0.617); and that of between EAR and PER (0.659); and that 

of between LAGMPS and LAGPER (0.585) are significant positively at 5% level before global 

financial melt down. The relationship between EPS and DPS (0.924); that of between EPSand RPS 

(0.720); that of between LAGPER and PER (0.946); that of between LAGMPS and DPS(0.706); 

that of between LAGMPS and RPS (0.876); that of between LAGMPS and EPS (0.827) are 

highly significant positively at 1% level after global financial melt down, whereas the relationship 

between DPS and RPS (0.594) is significant positively at 5% level. 

Regression result proves that DPS (121.65) and RPS (9.68) have significant positive co-efficient 

on EPS(SW) before global financial melt down of FMCG firms in India. DPS (76.74), LAGPER 

(1.52) and LAGMPS (0.27) have significant positive co-efficient (76.74) on EPS(SW) after global 

financial melt down of FMCG firms in India. Hence, it is inferred from the results that the 

shareholders’ wealth is dependent on the DPS, RPS, LAGPER, and LAGMPS.  On the whole, the 

results reveal that the selected variables viz DPS, RPS, LAGPER and LAGMPS have significant 

impact on earnings per share (SW).  

The results of the Chow test implies that the FMCG firms in India have a significant shift-in-

structure (improvement positively) in respect of DP on SW after global financial melt down (2009 – 

2013).  

When the firms pay dividend regularly with periodic growth, the SW would be maximized.  

This is quite possible for all dividend paying firms in FMCG sector in India. The DP has 

significant effect on SW of FMCG firms. From the analysis it is inferred that dividend per share, 



Financial Risk and Management Reviews, 2015, 1(1):8-26 
 

 
25 

© 2015 Conscientia Beam. All Rights Reserved. 

retained earnings per share , lagged price earning ratio and lagged market price per share  act as 

important variables in determining the SW.  Generally, higher DP enables increase in the market 

value of equity per share and vice versa. Shareholders preferred current dividend to future income 

so, dividend is considered to be an important variables, which determines the SW.   

Since dividend is an unsolved puzzle there is a need for constant and continuous efforts and 

attempts in the field of DP research. The explanatory power of the model used was found low 

through the econometric results implying room for future research works on the subject of 

research. The study is based on secondary data collected from the money control data source, and 

websites of various FMCG firms concerned in India.  Therefore, the quality of the study depends 

upon the accuracy, reliability, and quality of secondary data source.   

In the study, a sample of 13 FMCG firms is considered for analyzing the impact of dividend 

policy on shareholders’ wealth. In the study, OLS model of regression and chow test are used for 

analysis, therefore inclusion of some more appropriate methods of analysis, if used for analysis, 

will enable a further step in exploring new and further inference in the area of research.  

 

REFERENCES 

Allaro, B.H., B. Kassa and B. Hundie, 2011. A time series analysis of structural break time in the macro - 

economic variables in Ethiopia. African Journal of Agricultural Research, 6(2): 392 - 400. 

Atiyet, B., 2012. The impact of financing decision on the shareholders’ value creation. Journal of Business 

Studies, 4(1): 44-63. 

Azhagaiah, R. and N. Sabaripriya, 2008. The impact of dividend policy on shareholders’ wealth. International 

Research Journal of Finance and Economics, 20: 180-187. 

Azhagaiah, R. and P. Veeramuthu, 2010. The impact of firm size on dividend behavior: A study with 

reference to corporate firms across industries in India. Managing Global Transitions: International 

Research Journal, 8(1): 49-78. 

Bawa, S.K. and P. Kaur, 2013. Impact of dividend policy on shareholders’ wealth: An empirical analysis of 

indian information technology sector. Asia Pacific Finance and Accounting Review, 1(3): 17 – 24. 

Chidinma, O., S.C. Okaro and V.C. Pius, 2013. Shareholders value and firms dividend policy: Evidence from 

public firms in Nigeria. Research Journal of Management Science, 2(12): 26-28. 

Chow, G.C., 1960. Tests of equality between sets of coefficients in two linear regressions. Econometrica, 28: 

591-605. 

Devaki, S. and D. Kamalaveni, 2012. Shareholding patterns and dividend payout: An empirical analysis in 

Indian corporate hotels. International Journal of Multidisciplinary Research, 2(1): 49-63. 

Gul, S., M. Sajid, N. Razzaq, M. Iqbal and M. Bila Khan, 2012. The relationship between dividend policy and 

shareholders’ wealth. Economic and Finance Review, 2(2): 55-59. 

Kumaresan, S., 2014. Impact of dividend policy on shareholders’ wealth: A study of listed firms in hotels and 

travels sector of Sri Lanka. International Journal of Technological Exploration and Learning, 3(1): 

349-352. 



Financial Risk and Management Reviews, 2015, 1(1):8-26 
 

 
26 

© 2015 Conscientia Beam. All Rights Reserved. 

Lee, H.B., 2008. Using the chow test to analyze regression discontinuities. Tutorials in Quantitative 

Methods for Psychology, 4(2): 46 – 50. 

Olandipupo, A.O. and C.O. Okafor, 2011. Control of share wealth maximization in Nigeria. Journal of 

Business System Governance and Ethics, 6(1): 19-24. 

Onwumere, J., G. Ibe and O. Frank, 2012. Does the use of outsiders’ fund enhance shareholders’ wealth: 

Evidence from Nigeria. Journal of Finance and Investment Analysis, 1(1): 173-197. 

Parua, A. and A. Gupta, 2009. Dividend history and determinants in selected Indian firms. Australian 

Accounting Business and Finance Journal, 3(4): 46-83. 

Rafique, M., 2012. Factors affecting dividend payout: Evidence from listed non-financial firms of Karachi 

stock exchange. Business Management Dynamics, 1(11): 76-92. 

Salman, M., 2013. Effect of dividend policy on shareholders’ wealth: A study of sugar industry in Pakistan. 

Global Journal of Management and Business Research Finance, 13(7): 47-54. 

Tahir, A. and N. Raja, 2014. The impact of dividend policy on shareholders’ wealth. International Journal of 

Business and Management, 16(1): 24-33. 

Uwuigbe, U., J. Jafaru and A. Ajayi, 2012. Dividend policy and firm performance: A study of listed firms in 

Nigeria. Accounting and Management Information Systems, 11(3): 442-454. 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Views and opinions expressed in this article are the views and opinions of the author(s), Financial Risk and Management Reviews 
shall not be responsible or answerable for any loss, damage or liability etc. caused in relation to/arising out of the use of the content. 

 


