Hiral Mojidra
MBA- Batch 11
ITM, Kharghar
Roll No. KHR2018MBA-11P071

Title:
Relationship between Havells India Limited and NIFTY50.

Introduction: Havells India Limited is the country’s leading Fast Moving Electrical Goods (FMEG) manufacturer, producing a wide range of world class industrial and consumer electrical products. The Company works in step with the Make in India initiative and has an extensive production and distribution network across India and the world. Havells manufacturers 90% all its products in house.
Havells India Limited is listed on the Bombay Stock Exchange and the National Stock Exchange.

Objective:
To Find relationship of Havells with NIFTY
To calculate beta of Havells

Data Collection:
The closing price data of Nifty50 and Havells International Ltd was taken from www.nseindia.com (National Stock Exchange) for the time period 1st Feb 2018 to 31st Jan 2019
From the available data, the closing rates of all the Fridays in the year was sorted to find out weekly returns for both Nifty as well as Havells. Then the weekly returns were calculated for both by using formula –
Weekly Return =(W2-W1)/(W1*100)
where, W2 is present week closing price and W1 is the previous week closing price.
Once the data is calculated, weekly return column for NIFTY50 is considered as “X” variable and the weekly returns column for Havells Science is considered as “Y” variable.
The formulas used are :-
Y = a +bX
X ̅ =∑X/N
Y ̅=∑Y/N
x = X – X ̅
y = Y – Y ̅
b=∑xy/∑(x)^2
a= Y ̅- bX ̅
e = Y – Y ̅

Variance of error=(σe)^2 =∑e^2/N-K
S.E of b = √ ((σe)^2 /∑x^2)
t stat of b = b/ S.E of b
TSS=ESS+RSS
ESS = (b^2)*(∑x^2)
RSS = ∑e^2
R^2 = ESS/TSS
F = Mean ESS/Mean RSS

Data Analysis:
Equity = 0.72406921+1.10372717
Calculated T-stat value is 4.812746
N is 48
R Square is 0.33489989
F is 23.16252
P is 1.64E-05

The above equation shows relationship between equity and indices. As per equation, t-stat value is 4.812746 for b. The p value is 1.64 which is greater than 0.05 which means b is statistically not significant at 5% level. R Square is 0.33489989 which means 11% of equity is explained by indices. F is 23.16252 which is more than 0.05 which means b is statistically not significant at 5% level. Overall, model is statistically significant at 5% level.

Conclusion:
I hereby conclude that, in the period of 01 February 2018 to 31 January 2019, Havells India Limited-to-NIFTY50 model is a good model and is statistically significant. Thus, Havells India Limited is a good company to invest into.