The aim of this study is to examine the impact of dividend decisions on share prices of the selected pharmaceutical companies listed on the Bombay Stock Exchange. The research is completely based on secondary data. 15 pharmaceutical companies who have regularly paid dividend during the last five years have founded the sample of the study. The data regarding the average share prices is collected for 10 days before and 10 days after the declaration of dividend by the companies. T-test for paired sample means is used for examines the impact of dividend decision on the average share prices of the selected pharmaceutical companies. The outcome of the study shows that the share prices of the companies are not affected by the dividend announcement. It means that the shareholders’ wealth is irrelevance hypothesis to the dividend declaration in the case of selected pharmaceutical companies firms listed on the Bombay Stock Exchange.

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Keywords: Dividend, Pharmaceutical Companies, Share Prices, Bombay Stock Exchange.