REPORT
Title: Calculation of beta of Axis bank and its significance.
Name of author: Anmol Pahuja
Roll no : 21230022840
Batch: F1
Introduction: Axis Bank Limited, formerly known as UTI Bank, is an Indian banking and financial services company headquartered in Mumbai, Maharashtra. It sells financial services to large and mid-size companies, SMEs and retail businesses.
Objective: To calculate the beta of Axis Bank and its significance and to find whether this is a good option for investment
Data Collection: Data from 1st December 2021 to 30th November 2022 has been downloaded from www.nseindia.com.
Weekly returns of NIFTY 50 has been calculated using (X2-X1)/X1*100 and Weekly returns of Equity has been calculated using (Y2-Y1)/Y1*100. Weekly Returns of Equity has been regressed on Weekly returns of NIFTY.
Data Analysis:
• Y(axis Returns) = 0.639-0.146X(Nifty Returns)+ E
• t-stat = -0.195
• R2 = 0.0008164
• F = 0.038
• N = 49
The above equation tells us about the relationship between Nifty returns and Equity returns. The positive sign means, there is a direct relationship. If price rise by 1 unit demand will fall by 0.146 unit
T-stat “b” =0.195
Number of observation(N) are 49 and t-stat value is 0.195. P value for this is 0.845, which is more than 0.05 which means (b) is not statistically significant at 5%.
R2 is 0.008, which means 1% of Equity is explained by Nifty, balance 99% is error. Error is due to the variables which are not in the model.
F value is 0.038, the P value for which is 0.845, which is greater than 0.05%, which means overall the model is not statistically significant at 5%level
Conclusion: Here the Beta value is equal to 0.146, which is less than 1, it means it is not a good investment proposal given that the Nifty rises.
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