The Relationship between Ambuja cement Ltd and nifty.
By
Ankita Sunil Pawaskar
M.A Economics, S.N.D.T University

Introduction-
Ambuja cement Ltd is one of the top leading industries in infrastructure sector, incorporated on 20th October 1981. It manufactures clinkers and cement for domestic and exports markets. The Company has achieved a great amount of success in short period of time. It has now become one of the most trusted brands in Indian cement industry. Its revenue is in excess of Rs.3298 crore. It is traded as AMBUJACEM on National stock exchange. It is traded under nifty 50.

Objective-
To calculate the Intercept of Ambuja cements Ltd and observe its significance with respect to nifty weekly returns.

Data collection-
Data for Ambuja cement Ltd and nifty are downloaded from the official website of National Stock Exchange i.e. www1.nseindia.com/products/content/equities/equities.htm site. From the downloaded data only closing share prices all Friday of the year 2019 are sorted to find out weekly returns of both nifty and Ambuja cement LTD. The data has been analyzed for the period 1st January 2019 till 31st December 2019.

Data Analysis-
The data for Ambuja cement weekly returns(Y) and Nifty weekly returns(X) is calculated using regression method. The result of regression analysis is given below

Y= -0.560+1.506X*+ e
N=50, R2 = 0.40, F=33.198

1. The above equation shows us the relationship between X (weekly returns of nifty) and Y (weekly returns of Ambuja cement ltd). If weekly returns of nifty increase by 1 unit weekly returns of Ambuja cement ltd will increase by 1.50 units.

2. Positive sign means there is positive relationship, if nifty weekly returns rises, Ambuja cement weekly returns rise and vice versa.

3. T stat for b is 5.761; p value is less than 0.01, so b is statistically significant at 1% level.

4. R2 = 0.40, means 40% weekly returns of Ambuja cement ltd are explained by nifty returns(60% error)

5. F= 33.198* p value for which b is less than 0.01, so over all the model is statistically significant at 1% level.

Conclusion-
The model is statistically significant at 1% level of significance. However only 40% weekly returns of Ambuja cement ltd are explained by Weekly returns of nifty, hence the model is not dependable.