Title: Relationship of JSW Steel with Nifty.
Author: Jidnyasa Shridhar Bhoir – Roll No. 69.
Introduction: JSW Steel is a well-known company that produces steel, which is used to make things like buildings, cars, and appliances. They are a big player in the steel industry and are known for making high-quality steel products. JSW Steel is committed to using innovative technologies to create steel in an environmentally friendly way. The company is based in India and has a strong reputation for its products both nationally and internationally. With a focus on quality and sustainability, JSW Steel plays a significant role in shaping various industries around the world.
Objective: To Calculate the Beta of JSW Steel and find out its significance.
Views & Reviews:
1] Mrs. Sangita Jindal, Chairperson of SW Foundation, “Our strategic-partnership with IT Bombay is one-of-its kind industry-academia collaboration for advancement of research in steel manufacturing. This powerful combination will jointly leverage IT Bombay’s knowledge-rich faculties and JSW’s technical capabilities to develop novel industrial applications-for steel manufacturing with focus on low carbon emissions. This partnership will also initiate new academic courses while consolidating existing courses. We will also provide academic and technical leadership in broad areas of research while working towards increasing steel consumption in the country.”
2] Parth Jindal, Director of JSW Steel USA, said JSW Steel USA will invest US$145 million to upgrade manufacturing operations. “These new investments reiterate JSW’s commitment to a sustainable and green future. The operational upgrades being made at JSW Steel USA are a progressive step towards achieving our long-term ESG goals. These investments and projects will help us produce high quality melted and manufactured in the USA’ steel products required by our customers in the infrastructure and renewable energy sectors.”
Data Collection: The Data for the period 01- 06-2022 to 31-07-2023 has been downloaded from the NSE site, then Friday’s closing price was sorted and weekly returns of Nifty taken as X and weekly return of JSW steel taken as Y were calculated.
Data Analysis:
Equation “Y= -0.5934 + 0.1137 (X)”
(t. stat = 0.3578)
n = 50, R2= 0.0026. F = 0.7220
The above equation shows the relationship between the closing price of Nifty 50 (x) and the closing price of JSW Steel (y). The positive sign means a positive relationship meaning if “x” rises “y” rises and vice versa. If “x” rises by 1 unit, “y” rises by 0.1137, “n” means there are 50 observations.
The t-stat for b is 0.3578, which means b is statistically significant at 5% level. R2 is 0.0026 means 0.26% of y is explained by x, balance 99.74% is error due to the variables which are not in model. As the calculated value of F = 0.1280481 is less than the tabulated F (F 0.05, 1 DF,48DF) = 4.043, the overall model is statistically not significant at the 5% level.
So overall the model is not statistically significant at the 5% level.
Conclusion: As Beta is 0.113796595 which is less than 1, JSW Steel’s share is good for the long term.