Title: Relationship between Reliance Power limited with Nifty50
Author:
Rutuja Bhagwan Thotle (Kohinoor Business School) (MMS: Roll no. 42)
Introduction:
Reliance Power Limited is a part of the Reliance Group, one of India’s largest business houses. The group operates across multiple sectors, including telecommunications, financial services, media and entertainment, infrastructure and energy. The energy sector companies include Reliance Infrastructure and Reliance Power.
Reliance Power has been established to develop, construct and operate power projects both in India as well as internationally. The Company on its own and through its subsidiaries has a large portfolio of power generation capacity, both in operation as well as capacity under development.

Objective: To find out the beta of Reliance Power Limited and find its significance.
Data Collection:
Data was downloaded from NSE site for Nifty50 and Reliance Power limited, dated from 1st February 2019 to 31st January 2020 The data which was downloaded from that only Friday closing price was considered for Nifty50 and Reliance Power Limited , thus converting the data into weekly closing format.
Data Analysis:
Based on the Weekly closing format, Weekly returns were calculated with the help of formula ((week 2 – week1)*100)/week1.
The Weekly returns of Nifty50 were considered as Y and Weekly returns of Reliance Power limited were considered as X.
Later using the “Regression” option under “Data Analysis” in Excel following Output was generated
Equation: Ŷ = -4.057 + 1.033 X
(0.746)*
N (Number of Observations) = 51
R2 = 0.011
F = 0.557
Description:
Ŷ = -4.057 + 1.033 X
t -Stat = 0.746, N = 51, R2 = 0.011, F = 0.557
• The above equation tells us the relationship between Nifty50(X) and Reliance Power limited If Nifty50’s weekly returns rises by 1 unit then Reliance Power Limited weekly returns rises by 1.033 units and vice versa Positive sign means that there is a Direct Relationship which means if Nifty50 weekly returns rises then Reliance Power Limited weekly returns also rises and vice versa.
• t-Stat for b (0.746) and the p value (0.458) is more than 0.05 which means b is statistically insignificant at 5% level.
• R2 is 0.011 which means 1% of Y is explained by X. In other words 99% are other factors which are not in the model.
• F is 0.557 and the p value for which is more than 0.05 which means overall the model is statistically insignificant.

Conclusion: The model is not good as we can depend only 1% on it.