Question: Question 2: 8 Marks The Key financial data for ABC Telefilms Ltd is given below., Earnings per share for 2020 Number of shares outstanding Target

Question 2: 8 Marks The Key financial data for ABC Telefilms

Question 2: 8 Marks The Key financial data for ABC Telefilms Ltd is given below., Earnings per share for 2020 Number of shares outstanding Target payout ratio Planned dividend per share Stock price, year-end 2020 Rs. 5.00 40 million 50% Rs. 2.50 Rs. 130 ABC plans to pay the entire dividend early in January 2021. Should the company go for dividend payment or buy back shares? Please give proper justification based on the change in the total value of firm to the shareholders and/or P/E ratio

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