Title: “Relationship of Sun Pharmaceutical Industries Limited Shares with Nifty 50”
Author: Sejal Prakash Hiwale (MMS First year, Roll no. 0222017)
Kohinoor Business School, Kurla.
INTRODUCTION
Sun Pharmaceutical Industries Ltd. (Sun Pharma) is the fourth largest specialty generic pharmaceutical company in the world with global revenues of over US$ 5.1 billion. Supported by more than 40 manufacturing facilities, we provide high-quality, affordable medicines, trusted by healthcare professionals and patients, to more than 100 countries across the globe. Sun Pharmaceuticals was founded by Dilip Shanghvi in 1983 in Vapi, Gujarat, with five products to treat psychiatry ailments. Cardiology products were introduced in 1987 followed by gastroenterology products in 1989.
OBJECTIVE
Calculate BETA of Sun Pharmaceutical Industries Limited and observe its significance.
VIEWS & REVIEWS
- Dilip Shanghvi
(Managing Director)
Dear Shareholders, I am happy to report that we had a good year with strong performance across multiple parameters. Our global consolidated revenues grew by 12.6% to 433 billion while EBITDA grew by 12% to 116 billion. Adjusted net profit was up by about 12.8% to 86 billion. Our return ratios have also continued their improving trend this year. The contribution of our Global Specialty business has more than doubled from 7% of consolidated revenues in FY18 to 16.2% in FY23. It is among the larger businesses for Sun already, yet offers even more exciting growth avenues from here. Since inception, Sun has been deploying its resources to build new pharma businesses in a selective manner.
- Israel Makov
(Chairman, Non-Executive and Non-Independent Director)
Our R&D investments were approximately `22 billion, at 5.8% of overall sales. During the year, we filed approximately 200 formulation dossiers globally. We continued our R&D efforts to develop differentiated generics and innovative specialty products. Some of the clinical trials for our specialty products got delayed during FY22 due to the pandemic but are expected to gradually normalize in FY23. We have multiple R&D center’s and a strong R&D team which enables development of new products for various markets globally. We remain disciplined in identifying future R&D projects for the US generics market and the focus is on developing complex products. Investments for developing the long-term specialty pipeline are expected to continue and R&D investments are expected to increase as clinical trials for specialty products gain traction.
DATA COLLECTION
The data for this period has been download on NSE India site and weekly closing prices were found out. Weekly returns of Nifty 50 and weekly returns of Sun Pharmaceutical Industries Limited were calculated Nifty 50 returns were taken as X and equity returns Y (Y was regressed on X)
DATA ANALYSIS
Y^ = 0.88614 -0.85067 (X)
N= 50
(tstat = 0.104167)
R2 = 0.484439
F = 0.020833
The above equation shows the relationship between the closing price of Nifty 50 (x) and the closing price of Sun Pharmaceutical Industries Ltd. (y) the negative sign means a negative relationship meaning if “x” rises “y” falls and vice versa. If “x” rises by 1 unit, “y” falls by 0.85068, “n” means there are 50 observations. The t-stat 0.104167 for b is, which means b is statistically significant at 5% level. R2 is 0.484439 means 48.44% of y is explained by x, balance 51.56% is error due to the variables which are not in model. As the calculated value of F =0.020833 is more than the tabulated F (F 0.05,1DF,48DF) = 45.10, the overall model is statistically significant at the 5% level.
So overall the model is statistically significant at the 5% level.
CONCLUSION
As Beta is 0.85068 which is less than 1 So, this share is good for long term. B<1
REFERENCE
https://www.nseindia.com/reports-indices-historical-index-data
https://sunpharma.com/