By Ayush Gupta
SAP ID: 80012100764
Introduction:
Adani Group is an Indian multinational conglomerate, headquartered in Ahmedabad. It was founded by Gautam Adani in 1988 as a commodity trading business, with the flagship company Adani Enterprises Limited (previously Adani Exports Limited). The Group’s diverse businesses include port management, electric power generation and transmission, renewable energy, mining, airport operations, natural gas, food processing and infrastructure. The group has annual revenue of over US$15 billion with operations at 70 locations in 50 countries.
In April 2021, Adani Group became the third Indian conglomerate to cross $100 billion in market capitalization.
Incorporated in 1999, Adani Wilmar is a food processing company and a joint venture between Adani Enterprises and Wilmar International. In November 2000, Adani Wilmar launched its flagship brand “Fortune” under which it produces and sells edible oil, flour, rice, pulses, sugar, soya nuggets and instant food mixes.[50] The company also makes personal care products like soaps, handwash and hand sanitizers under “Alife” brand.
Objective:
To calculate the beta of the company and find its significance
Views and Reviews of Adani Wilmar
There vision is to be a leading agribusiness company committed to sustainably deliver safe, nutritious and quality agricultural commodity and food through innovation, highest standards of environmental, social and governance practices, and the creation of livelihoods in communities in which we operate to deliver long term value to all our stakeholders.
They are one of the few large FMCG food companies in India to offer most of the essential kitchen commodities for Indian consumers, including edible oil, wheat flour, rice, pulses and sugar. Our products are offered under a diverse range of brands across a broad price spectrum and cater to different customer groups.
Data Collection:
Data of index and equity were collected from https://www1.nseindia.com/. Daily returns from 1st March-2021 to 28 Feb-2022 were downloaded in excel format from these websites and it was sorted into weekly format. Then weekly returns were calculated for both index and equity and then regression analysis was done.
Data Analysis:
Predicted Y = 0.296398 + 1.104366 X
N=46, R Square= 0.320096, F= 20.71503
Tstat (beta) = 0.574816
Tstat (0.05,45)= 4.551377
The above regression equation tells us the relationship between X and Y. Where X is
NIFTY’s weekly returns and Y is weekly returns Adani Wilmar.
The positive sign of Beta tells us the that there is a positive relationship between NIFTY
and Adani Wilmar weekly returns.
From the equation, it can be seen that if X rises by 0.5 unit, Y will rise by 0.505015 units. T calculated is more that T tabulated which means, β is statistically significant at 5% confidence level.
R^2 is 0.320096which means 32% of Y (Adani Wilmar) is explained by X. And the balance is explained by error.
F is 20.71503 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 Adani Wilmar. Also, it can be concluded that Adani Wilmar is a low beta share. Since it is around than 0.5.