Sanchit Aggarwal
80012100826
TITLE: Relationship of Nifty and Sundram Fasteners Limited
AUTHOR: Sanchit Aggarwal
Introduction
Sundram Fasteners Ltd a part of USD 8.5 billion TVS Group company is one of the leading auto component manufacturers in India. The company is engaged in the manufacture of fasteners powertrain components sintered metal parts iron powder cold extruded parts iron power cold extruded parts radiator caps and wind energy components. They also signed another technical collaboration agreement with Sinter Metalworker Germany to manufacture 2000 TPA automotive powder metal components. In the year 1992 the company set up an export oriented unit for manufacture of radiator caps oil filler caps and petrol filler caps for General Motors USA
OBJECTIVE: To calculate Beta Value Of Sundram Fasteners Ltd and find its significance.
VIEWS AND REVIEWS:
DATA COLLECTION: The data of NIFTY and Sundram Fasteners Ltd SAIL was collected through NSE Website and was downloaded from 1-March-2021 to 28-February-2022 in an excel sheet. The closing prices were found out. The data was filtered on weekly basis and then weekly returns of both NIFTY and Sundram Fasteners Ltd was calculated. The company returns have been regressed on nifty’s returns.
DATA ANALYSIS:
Predicted Y = 0.001803+ 0.096034 X
N=47, R Square= 0.135527, F= 6.898041
Tstat(beta)= 2.62641
Tstat (0.05,45)= 2.0141
The above regression equation tells us the relationship between X and Y. Where X is NIFTY’s weekly returns and Y is Sundram Fasteners Ltd weekly returns.
The positive sign of Beta tells us the that there is a positive relationship between NIFTY and Sundram Fasteners Ltd weekly returns.
From the equation, it can be seen that if X rises by 1 unit, Y will rise by 0.096034 units.
T calculated is more that T tabulated which means, β is statistically significant at 5% confidence level.
R^2 is 0.13353 which means 13% of Y Sundram Fasteners Ltd is explained by X. And the balance is explained by error.
F is 6.89 which is more than table value which means model is statistically significant at 5% level.
CONCLUSION:
β is statistically significant in case of NIFTY and Sundram Fasteners Ltd. Also, it can be concluded that Sundram Fasteners Ltd. It is a low beta share since it is less than 1.