Topic Name: Relationship of Raymond LTD. with NIFTY.
Author: Ruchita Nitin Kulkarni
Roll No. :30
Introduction: Raymond Ltd, a major Indian textile and apparel business, trades on the National Stock Exchange (NSE) under the ticker symbol “RAYMOND.” Founded in 1925 by Vijay pat Singhania, the company has grown to become a major participant in the textile and apparel industries. Raymond Ltd, headquartered in Mumbai, Maharashtra, operates in a wide range of business categories, including textiles, ready-to-wear clothing, engineering tools, and auto components. Its portfolio includes well-known brands such as Raymond, Park Avenue, Colo Plus, Parx, and Ethnic, which provide a diverse range of apparel alternatives for men, women, and children. In addition to its trendy items, Raymond Ltd has expanded into engineering tools and vehicle components, demonstrating its versatility.
Objective: To calculate beta of Raymond LTD. and find out its significance.
Views & reviews: Raymond Ltd had a diverse group of directors’ chairmen, Gautam Hari Singhania Chairman & Managing Director who played vital roles in the company’s governance and decision-making. Raymond Ltd.’s director reviews focus on industry expertise, leadership, growth contributions, and CSR involvement. Directors bring diverse talents and viewpoints, fostering effective decision-making and goal alignment.
Data Collection: The data from 1/7/2022 to 30/6/2023 for this period has been downloaded from the NSE site, and weekly closing prices were found out. Then the weekly return of Nifty and the weekly return of Raymond Ltd were calculated. Nifty returns were taken as X & Raymond Ltd returns were taken as Y. Y was regressed on X.
Data Analysis: – Equation “Y= -1.1811+0.2301 (X)”
(t Stat= 0.387803)
n = 50, R2 =0.003123, F = 0.150391, Beta=0.2301
The equation demonstrates the relationship between the closing price of nifty 50(X) and the closing price of Raymond Ltd (Y). The positive sign implies a positive relationship: as X increases, Y also increases, and vice versa. For every one-unit increase in X, Y is expected to rise by 0.2301 units. There are 50 observations. The t-statistic for coefficient B is 0.3878, indicating that B is statistically significant at the 5% level. The R² value of 0.003123 suggests that only 0.31% of the variation in Y can be explained by X balance 99.69 is error due to the variables which are not in the model. Since the F =0.1503 which is less than the tabulated F value (F 0.05, 1DF, 49DF = 4.038), the overall model is statistically not significant at a 5% level.
Conclusion:
As beta is 0.2301 which is less than 1, so Raymond Ltd share is good for long term.