Why Shareholder like Dividend

Shareholders like dividends because...
Shareholders have their own personal cash needs and self-select the companies whose dividends satisfy these.
Preferred shareholders like common share dividends because it creates a cushion that must be cut before their own dividends are.
Shareholders feel the risk of returns from reinvested earnings at a later date, is higher than the risk of cash received today.
Benjamin Graham and David Dodd, in the classic 1934 reference Security Analysis, suggest that retaining earnings is, in effect, management dictating to owners how to invest their money.
Reasons companies don't pay dividends
Management and the board may believe that the money is best re-invested into the company: research and development, capital investment, expansion, etc. Proponents suggest that a management eager to return profits to shareholders may have run out of good ideas for the future of the company.
When dividends are paid, shareholders in many countries suffer from double taxation of those dividends: the company pays income tax to the government when it earns any income, and then when the dividend is paid, the individual shareholder pays income tax on the dividend payment. This is often used as justification for retaining earnings, or for performing a stock buyback, in which the company buys back stock, thereby increasing the value of the stock left outstanding. The shareholder will pay a tax on capital gains (which is often taxed at a lower rate than ordinary income) only when the shareholder chooses to sell the stock. If a holder of the stock chooses to not participate in the buyback, the price of the holder's shares should rise, but the tax on these gains is delayed until the actual sale of the shares. Certain types of specialized investment companies (such as a REIT in the U.S.) allow the shareholder to partially or fully avoid double taxation of dividends.
Shareholders in companies which pay little or no cash dividends can reap the benefit of the company's profits when they sell their shareholding, or when the company is wound down and all assets liquidated and distributed amongst shareholders.

The above is more useful link for US concept, in Malaysia, we need to settle the tax difference before we can earn out net dividend or money received. This is unfavour for creating shareholder value or encouraging public to invests.