Title: – Relationship of Axis Bank Ltd.with Nifty 50
Author: – Aniket Anil Joshi (MMS First Year, Roll no. 0222086)
Kohinoor Business School, Kurla.
Introduction: – Axis Bank is the third largest private sector bank in India. The Bank offers the entire spectrum of financial services to customer segments covering Large and Mid-Corporates, MSME, Agriculture and Retail Businesses.
The Bank has a large footprint of 4,903 domestic branches (including extension counters) with 15,953 ATMs & cash recyclers spread across the country as on 31st March 2023. The Bank has 6 Axis Virtual Centres with over 1,500 Virtual Relationship Managers as on 31st March 2023. The Overseas operations of the Bank are spread over eight international offices with branches in Singapore, Dubai (at DIFC), and Gift City-IBU; representative offices in Dhaka, Dubai, Abu Dhabi, Sharjah and an overseas subsidiary in London, UK. The international offices focus on Corporate Lending, Coverage Business, Trade Finance, Syndication, Investment Banking, Liability Businesses, and Private Banking/Wealth Management offerings.
Objective: – To Calculate the Beta of Axis Bank Ltd. and find out its significance.
Views and Reviews: –
Amitabh Chaudhry MD & CEO axis bank Limited, Given the powerful integrated platform we are building, we will continue to grow 400 to 600 bps faster than the industry, in the medium to long term. The significant strides we made during the year on our customer obsession journey, digital capabilities, Bharat Banking and successful acquisition of Citibank India Consumer Business further give us the confidence in sustaining this performance.
Rajiv Anand Deputy Managing DirectoThe corporates have de-levered significantly in the last seven years and the corporate cash flows continue to remain strong. While the banking system has not lent to corporates in a meaningful way over the last 3 to 5 years, I believe the new credit growth cycle has just started. The overall capacity utilisation in manufacturing sector has now exceeded the long-term averages and there is strong demand from companies across sizes and sectors.
Data Collections: – Data is taken from 01-07-2022 to 30-06-2023. It has been downloaded from the NSE site, then Friday’s closing price was sorted and weekly returns of Nifty (i.e. X) and Axis Bank Ltd.(i.e. Y) were calculated.
Data Analysis: – Equation “Y=1.3668-1.1166(X)”
(tstat = 4.1030)
n = 50, R2 = 0.2794, F = 18.6117
The above equation shows the relationship between the closing price of Nifty 50 (x) and the closing price of Axis Bank (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 1.1166, “n” means there are 50 observations, and figures in brackets are tstat for “b”, so “b” is not as Calculated tstat for b i.e. 4.1030 is higher than tabulated t(t0.5,49DF=1.677) so reject H0 and accept H1. R2 is 0.2794 means 27.94% of y is explained by x. As the calculated value of F =18.6117 is higher than the tabulated F (F 0.05,1DF,49DF) = 4.038, the overall model is statistically significant at the 5% level.
So overall the model is statistically significant at the 5% level.
Conclusion:
If b>1, Axis bank share is good for short term investment.
References
https://www.bseindia.com/xml-data/corpfiling/AttachHis//90b930a8-4c38-4490-afd8-3eb51a9331c8.pdf
https://www.axisbank.com/about-us/corporate-profile