Dividend Policy of Kanchan Development Bank Pvt Ltd,

Attariya,Kailali

A PROJECT WORK PROPOSAL

Submitted By
Devi Ojha
BBS 4th Year
Group: Finance
Symbol No: - 706050059
TU Registration No:-7-2-605-125-2017
Durga Laxmi Multiple Campus

Submitted to
The Faculty of Management
Tribhuvan University
Kathmandu

In partial fulfillment of the requirement for the Degree of

BACHELOR OF BUSINESS STUDIES (BBS)
Attariya, Kailali
2078 B.S

….……………………… ….. …….….………..…….

Supervisor Head of Research Committee
Table of contents Page no

1 Introduction
1.1 Background of the Study 1
1.2 Objectives of study 2
1.3 Rationale of the Study 2
1.4 Brief profile of the organization 3
1.5 Scope of the Study 3
1.6 Review of Literature 4
1.7 Research Methodology 4
1.8 Limitation of the Study 4
1.9 Chapter Plan 5
Reference
1.Introduction:
1.1 Background of the study:
A dividend policy is the policy a company uses to structure its dividend payout to
shareholders. Some researchers suggest the dividend policy is irrelevant, in theory, because
investors can sell a portion of their shares or portfolio if they need funds. This is the dividend
irrelevance theory, which infers that dividend payouts minimally affect a stock's price.
Despite the suggestion that the dividend policy is irrelevant, it is income for shareholders.
Company leaders are often the largest shareholders and have the most to gain from a
generous dividend policy.
Most companies view a dividend policy as an integral part of their corporate strategy.
Management must decide on the dividend amount, timing, and various other factors that
influence dividend payments. There are three types of dividend policies—a stable dividend
policy, a constant dividend policy, and a residual dividend policy.
A dividend policy dictates how much cash is returned to shareholders. When deciding what
dividend to pay, if any, a company must look at the profits it has made and weigh up how
much should be retained in the business to fund future growth and how much should be
returned to investors. If it has had a bad year and it doesn’t have enough profit to cover its
investment needs and the dividend, but expects the poor performance to be a one-off, then
it may still make a payout to investors by either dipping into any surplus cash it has or using
debt. For example, preference shares are usually entitled to dividends before common
shareholders while American depositary receipts (ADRs) often earn a different dividend to
other investors. Some share classes may not be entitled to dividends at all.   
Some companies also choose to add what is known as a ‘scrip alternative’ dividend
programme, which allows shareholders to receive the value of their dividends in new shares
in the business rather than cash. Dividend policies may also include clauses that detail how
bonus payments may work, such as special dividends or share buybacks.  

The main objective of this program is the best way to help us in getting familiar to the
business environment specially the dividend policy of Kanchan Development Bank Pvt
Ltd ,Attariya .It gives an opportunity to apply the theoretical knowledge to work. Our main
objective of this project is to develop skills appropriate to work and gain a professional
experience. It is the most important avenue for us in career planning and placement.
In the context of Attariya, the formal operation of Kanchan Development Bank Pvt Ltd
started from 2009(2066 B.S) (categorized under cooperative).

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In an economy driven by appetite for success, Kanchan Co-operative is “The co-operative for
all” by defining new levels of services and products and enhanced its service level and
satisfied customer ,within three years it is categorized under development bank.Now it is one
of the financial hub of city.
Due to growth of Kanchan Development Bank Pvt Ltd customers and economy ,it is
distributing good retained earnings to its shareholders and staffs.

1.2. Objectives of the study:

The main objective of the study about Dividend Policy of Kanchan Development Bank
Ltd ,Attariya is to analyze dividend system which further helps in the following important
determinants
 To Know the dividend policy of Kanchan Development Bank Pvt Ltd .
 To extent of dividend distribution .
 To get familiar with need for additional Capital .
 To evaluate trends of profits

1.3. Rational of study:

The study of this fieldwork is important in various fields. Some of the importance of
this fieldwork report is highlighted below:
This field work will be prepare to fulfill the objective set for by newly designed
course of design of BBS 4th year.
This report will be help the student of financial management to gain and share
some practical knowledge of dividend system in banking industry.
This field work record will be useful for the library purpose.

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1.4.Brief profile of the organization:
 Name of Organization:Kanchan Development Bank Ltd
 Location:Mahendranagarroad,Attariya-2,Godawari
Municipality,Kailali,Nepal
 Office Type: Branch
 Head Office:Kanchanpur
 Estd :2066/04/09
 Reg No:-1159/066/067
 Board of Director: Mr. Shiv Singh Karki
 Website:www.kanchanbank.com
 Number of branch:15
 Email: attariya@kanchanbank.com.np
 Contact Person:Gajendra Shahi
 Contact Number: 091-551142

1.5.Scope of the study:

 This study will be only dividend policy for the Kanchan Development Bank Pvt.
Ltd.
 This study will be prepare on the basis of post data.
 This study will be valueable for stakeholders Investor,Customer,Management
etc.)

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1.6.Review of literature
 Theoretical Frame Work
 Review of Previous Studies
 Review of Journal ,Article, Bulletin, Books, Project work, Annual report,
Internet etc
1.7. Research methodology:

 Research Design
 Descriptive
 Analytical
 Qualitative
 Quantitative
 Sources of Data
 Primary Data
 Secondary Data
 Tools
 Financial tools
 Statistical Tools
 Technique
 Table
 Diagram
 Pie-chart
 Figure

1. 8. Limitation of the study:

 The general study will be focus on the dividend policy of Kanchan
development bank Ltd, Attariya
 The study will be mainly based on published Secondary data.
 This study will be unbiased but resource and time period is limited.
 This study will be based on fiscal year 2072/73 B.S - 2074/75 B.S.

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1.9.Chapter plan
Chapter1. Introduction
1.1.Background of the study

1.2.Objectives of the study

1.3.Rational of the study

1.4. Brief profile of the organization

1.5. Scope of the study

1.6. Review of literature

1.7.Research methodology

1.8.Limitation of study

Chapter2:Result and Analysis

Chapter3:Summary and Conclusion

Bibliography
Appendix:
 Abbreviation

BBS = Bachelor Of Business Studies

PVT = Priviate

LTD = Limited

T.U = Tribhuvan University

 References

Rustagi, Dr.R.P. Financial Management. Taxmann Publications (P.) Ltd. ISBN 978-81-7194-

786-7.

Kothari ,Vinod. "Dividend Policy" (PDF). Archived from the original (PDF) on 2012-01-05,

Timmer, Jan (2011). "Understanding the Fed Model, Capital Structure, and then
Some". SSRN 1322703

Adhikari ,Dev Raj (2016) ,Business Research Methods, Asmita publication ,Kathmandu Nepal

Joshi,Padam Raj (2016),Fundamental of Financial Management, Asmita

publication ,Kathmandu Nepal

Pant,P.R and Wolf Howard k (1999),Social Science and Thesis writing,

Kathmandu Buddha Academic Publication Enterprise(P) Ltd

Webistes:

www.kanchanbank.com.np

Annual report of banks