Relationship between Nifty and Siemens Ltd

Relationship between Nifty and Siemens Ltd.

By SHUBHAM JADHAV
SAP ID: 80012100881
Introduction:
Siemens is a global powerhouse focusing on the areas of electrification, automation and digitalization. One of the world’s largest producers of energy-efficient, resource-saving technologies, Siemens is a leading supplier of systems for power generation and transmission as well as medical diagnosis. In infrastructure and industry solutions the company plays a pioneering role.
Siemens’ technical expertise, comprehensive portfolio and long-standing experience are helping to pioneer a sustainable future across the globe. Find detailed information, news, insights, and references on the topic areas that exemplify Siemens’ success in providing state-of-the-art solutions in fields including IT, industry, finance, and energy.
Siemens is a global powerhouse positioned along the electrification value chain – from power generation, transmission and distribution to smart grid solutions and the efficient application of electrical energy – as well as in the areas of medical imaging and laboratory diagnostics. Today, Siemens has around 377,000 employees in more than 200 countries/regions. We operate in production and manufacturing plants worldwide. In addition, we have office buildings, warehouses, research and development facilities or sales offices in almost every country/region in the world.

Objective:
To calculate the beta of the company and find its significance
Views and Reviews of Siemens
Siemens Limited focuses on the areas of electrification automation and digitalization. It is one of the leading producers of technologies for combined cycle turbines for power generation; power transmission and distribution solutions; infrastructure solutions for Smart Cities and transportation; automation and software solutions for industry and also supplier of healthcare equipments.
Siemens Limited has 21 factories located across India and a nation-wide sales and service network. Siemens Limited in which Siemens AG Germany holds 75% of the capital is the flagship listed company of Siemens AG in India.Siemens Ltd was incorporated in the year 1957 as Siemens Engineering and Manufacturing Company of India Pvt Ltd.
In March 1957 the company entered into a collaboration agreement with two foreign companies viz. Siemens & Halske AG and Siemens Schuckertwerke AG of West Germany. In the year 1966 the name of the Siemens & Halske AG was changed to Siemens AG and at the same time it took over the manufacturing and business activities of Siemens-Schuckertwerke AG and Siemens-Reiniger-Werke AG. The name of the company was changed in the year 1967 from Siemens Engineering & Manufacturing Company of India Ltd to Siemens India Ltd.

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 Siemens Ltd’s weekly returns.
The positive sign of Beta tells us the that there is a positive relationship between NIFTY
and Siemens Ltd’s 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 (Siemens Ltd) 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 Siemens Ltd. Also, it can be concluded that Siemens ltd is a low beta share. Since it is around than 0.5.

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