Relationship of The Sandesh Ltd. With Nifty 50

Topic Name: Relationship of The Sandesh Ltd. With Nifty 50

Author: Sandesh Nandlal Ambhore (MMS First Year, Roll No. 0222067)

Kohinoor Business School, Kurla.

Introduction: Sandesh the largest media house of Gujarat with its presence in newspaper, television and digital medium is committed to empowering the people of Gujarat and enhancing their knowledge for past 99 years. The Sandesh Limited is a listed public company incorporated on 11 March, 1943. It is classified as a public limited company and is located in Ahmedabad, Gujarat. It’s authorized share capital is INR 15.00cr and the total paid-up capital is INR 7.57 cr.

The Sandesh Limited’s operating revenues range is INR 100cr – 500cr for the financial year ending on 31 March, 2022. It’s EBITDA has increased by 10.89 % over the previous year. At the same time, it’s book net-worth has increased by 7.01 %.

Objective: To calculate beta of The Sandesh Ltd, and find out its significance.

Views & Reviews:

The Company”s Directors Falgunbhai Chimanbhai Patel, Sudhir Nanavati, Sanjay Kumar Tandon, Pannaben Falgunbhai Patel, Parthiv Falgunbhai Patel, Gauri Trivedi, Sandeep Mohanraj Singhi made the following statement:

  1. In the preparation of the annual accounts, the applicable accounting standards have been followed to the extent applicable to the Company and there are no material departures;
  2. They have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period;
  3. They have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
  4. They have prepared the annual accounts on a going concern basis;
  5. They have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and operating effectively; and
  6. They have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

 

Data Analysis:

Equation Y=1.1065+0.1427(X)

                    (tstat =1.3571)

           N=45, R2 =0.0420, F=1.8418

The above equation shows the relationship between the closing price of Nifty 50 (x) and the closing price of The Sandesh Ltd. (y) the positive sign means a negative relationship meaning if “x” rises “y” rises and vice versa. If “x” rises by 1 unit, “y” rises by 0.1549, “n” means there are 45 observations. The t-stat for b is 1.3571, which means b is statistically significant at 5% level. R2 is 0.0420 means 4.2% of y is explained by x, balance 95.8% is error due to the variables which are not in model.  As the calculated value of F =1.8418 is more than the tabulated F (F 0.05,1DF,43DF) = 4.043, the overall model is statistically not significant at the 5% level.

So overall the model is statistically not significant at the 5% level.

Conclusion:

As Beta is 0.1427 which is less than 1, the Compnay is good for long term.

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