The main objectives of the present study were to study the relationship between dividend and stock returns and dividend yield and stock returns of selected BSE Listed Pharma and Chemical companies. Further, the study measures the impact of DPS on ROA. The present study was also highlighted the significant difference of dividend payout ratio among different Pharma & Chemical companies selected for the study. The present study was carried on the data collected from BSE listed Pharma and chemical companies. The secondary data consists of facts & figures of dividend payout, dividend per share, dividend yield etc. The relevant data of dividend, stock returns, dividend yield, DPS, ROA, dividend payout ratio have been collected from the financial statements of the Pharma & Chemical companies over the period of 2018 to 2022. The result of this paper suggests that, dividend has significant effect on stock returns of Pharma & Chemical companies selected for the study. The framed hypotheses were tested by using regression analysis and one-way anova test.

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Keywords: Dividend, Dividend Yield, Stock Returns, DPS, ROA, ANOVA.