Dividends are payments that companies make to their shareholders from their profits. They are a way of rewarding shareholders for investing in the company and sharing its success. But how much of a company’s earnings are paid to shareholders as dividends? Also, how do you choose the best dividend-paying stocks and mutual funds in India? In this blog, we will explain the most useful financial metrics: payout ratio/ what does dividend payout ratio represent also formula for dividend payout ratio. The dividend payout ratio (DPR) indicates the portion of a company’s net income that the company pays out to shareholders as dividends. It demonstrates how much of the company’s earnings shareholders receive and how much it keeps for growth or debt repayment. Let us understand the what is Dividend Payout Ratio in the stock market and its implications.