THE FACTORS THAT DETERMINE DIVIDEND POLICY IN LISTED MANUFACTURING COMPANIES: A CASE STUDY OF DAR ES SALAAM STOCK

Abstract

ABSTRACT This study looks at how manufacturing companies decide about sharing money with their investors. It's especially interested in those listed on the Dar es Salaam Stock Exchange. The main goal is to understand the things that influence these decisions. To do this, the study has some clear goals it wants to achieve. This research is guided by three main objectives: to explore the potential link between manufacturing company size and dividend policies, analyze the interplay between growth trajectories and dividend strategies, and examine the influence of investment opportunities on dividend policies. The study focuses on five companies listed on the Dar es Salaam Stock Exchange in Dar es Salaam city, selecting three established and two less established firms based on dividend policy and payout experience for balanced findings. Using a qualitative approach, the study captured participants' sentiments and gathered diverse data, enhancing the understanding of dividend policy determinants through methods like case studies and interviews. Employing an embedded multiple case study design, the research analyzed three listed companies, enabling a thorough exploration of dividend policy factors from participants' viewpoints and maintaining minimal interference with their behavior. Incorporating Tanzania Breweries, Tanzania Cigarette Company, and Simba Cement, this research design aims to uncover nuanced insights into the factors influencing dividend policy within the context of the listed companies on the Dar es Salaam Stock Exchange (DSE). The study analyzed dividend policy in DSE-listed firms, identifying factors like profitability, cash flows, size, leverage, and liquidity influencing distribution decisions. These revelations benefited the parties involved and expanded the context of manufacturing enterprises with empirical evidence. Larger companies had higher payouts, improved access to the financial markets, stable cash flows, and higher investor dividend expectations.Policymakers are urged to consider the distinctive attributes and challenges intrinsic to manufacturing companies when shaping taxation, capital market access, and financing policies.When transitioning to the sphere of manufacturing companies, a series of recommendations arise. Manufacturers are prompted to conduct regular evaluations of their profitability, liquidity, growth prospects, and investment opportunities to inform their dividend policy decisions. Such comprehensive assessments could yield a more informed and strategic approach to dividend distribution.