Relationship of SAL STEEL with nifty 50
Author: SHEETAL NERLEKAR MMS, Roll No: 0222104
Introduction: SAL Steel is a versatile steel, Ferro Alloys and Power Company having operations near Kandla Port in the state of Gujarat in Western India. Our product range consists of Direct Reduced Iron (DRI/Sponge Iron), Ferro Alloys, Iron Ore pellets and various finished steel products. We are also selling power to various customers from our 40 MW power plant. The company has double advantage of having proximity one of the busiest commercial port and also to the customer of company’s finished products. We have been successful in securing long term tie-up for our various raw materials by renowned suppliers. This has led up to achieve consistent high standard of quality in our finished products.
Objective:
To calculate beta of SAL steel and observe its significance.
Views and reviews:
- Rajendra v. Shah (2021) says that, chairman” SAL steel companies’ revenue dropped from 452.14 to 322.87 crores in the last year, resulting in a net profit of 11.55 instead of 15.87 crores. It was decided not to suggest a dividend year 2020–21 due to ongoing expansion initiatives. The business manufactures sponge iron, ferro alloys, and power and has a 40 mw internal power plant. Director mr. Anil kumar pandya retired, and mr. Jai prakash goyal was appointed in his place. There were no noticeable modifications, and the auditor’s report had no unfavorable observations.
- Rajendra v. Shah (2021) says that , ” SAL steel company’s operational revenue climbed from 322.87 to 534.53 crores during the review year, resulting in a net profit of 16.24 crores as opposed to the prior 12.42 crores. A dividend was not advised for 2021–2022 because to ongoing growth initiatives. The company uses a 40 mw power plant for internal usage while producing sponge iron, ferroalloys, and power. Loans, guarantees, and investments remained largely unchanged. The business acknowledges support from stakeholders and employees while upholding solid corporate governance procedures.
Data collection:
Data for This Period (1/7/2022 to 30/6/2023) has been downloaded from NSE India Site and Weekly Closing Prices Where Found out Then Weekly Returns of Nifty a Weekly Return of SAL steel were Calculated (Nifty Returns Taken as X and Equity Return Taken As Y) Y Was Regress On X.
Data analysis:
|
Equation y= -1.53-3.28x+e |
(SAL steel =-1.53-3.28Nifty 50 + e)
T stat for b = -2.270
R2 = 0.096
F= 5.155
The above equation do not show any relationship between nifty 50 (X) and SAL steel (Y). SAL steel runs on own fundamentals the t stat for b is -2.270 not statistically significant at 5 % level, R2is 0.096 which means 9.6% Y is explained by X. 90.4% is the error in model. 5.155 Which is less than the table value which means overall them model is not statistically significant at 5% level.
Conclusion:
The Beta of the SAL steel is < 1 so The Company Is Good For Long Term Investment.