Title: Relationship of SRF Limited with Nifty and to Calculate Beta.
Author: Shreya Upadhyay
Introduction:
SRF Limited is a prominent Indian multinational company with a diverse portfolio spanning chemicals, technical textiles, packaging films, and pharmaceuticals. Originally established as Shri Ram Fibres in 1970, SRF has evolved into a leading player in the global market, known for its commitment to innovation, sustainability, and quality. The company’s chemical division produces various industrial and speciality chemicals, catering to various industries. SRF is also a major player in the technical textiles sector, manufacturing products for applications in agriculture, automotive, and construction. Additionally, the company is engaged in the production of packaging films and has a growing presence in the pharmaceutical sector. SRF Limited is recognized for its strong emphasis on research and development, driving its continuous growth and success in the competitive business landscape.
Objective: To calculate Beta and to see its significance.
Literature Review:
1-Summary:
Singal, N. (2023, May 14) states that SRF started life as Shri Ram Fibres, a technical textiles and tyre cord manufacturer, in the 1970s, before diversifying into refrigerant gases in the late 1980s; in the mid-1990s, the company got into polyester films (that was used for VHS tapes and audio cassettes back then), which has since then transformed into its packaging films business. Bharat Ram has also expanded the packaging films business to Thailand, South Africa and Hungary; today, chemicals contribute 42 per cent to SRF’s top line, packaging films 38 per cent, with technical textiles and other businesses making up the rest. […]companies that have built strong in-house capability will have the ability to also look at offshoring more products from Europe.
2-Summary:
Hryhorenko, et al (2023) states that the damaged layer produced during the Niobium sheets and cavity fabrication processes is one of the main reasons why cavities have to undergo an extensive surface preparation process to recover optimal superconducting properties. Today, this includes the use of lengthy, costly, and dangerous conventional polishing techniques such as buffered chemical polishing (BCP), or electro-polishing (EP). We propose to avoid or at least significantly reduce the use of acids. We developed a novel method based on metallographic polishing of Nb sheets, consisting of 2–3 steps. We demonstrate that this surface processing procedure could be transferred to large dimensions and an industrialized scale thanks to the limited number of steps and its compatibility with standard lapping polishing devices.
Data Collection:
The data for Nifty and Equity for SRF Ltd has been downloaded from Nse.com and finance.yahoo.com for the period 1st Nov 2022 to 31st Oct 2023. The data was manipulated for the closing price of nifty and equity. The weekly returns of nifty and equity were found.
Data Analysis:
SRF Share= 0.00978 + 0.9999 Nifty
n= 48, R square= 1, F = 1.218
The above equation shows the relationship of the company ‘SRF Limited’ with ‘Nifty.’ t stat for b is 0.46, and the p-value is 0.64, which is more than 0.05 so, b = 0. This means Nifty does not impact ‘SRF Limited’.
R^2 = 1 Meaning 1% of ‘SRF Limited’ share is explained by Nifty and 99% depends upon other things like fundamentals.
F = 1.218 And p = 0.645 which is more than 0.05, hence, the model is not statistically significant at the 5% significance level, further Nifty does not affect the share significantly.
Conclusion:
The results indicate that (Beta) i.e. b = 0.9999 which is less than 1; so it has an correlated relationship with the market.
References:
Hryhorenko, et al (2023). An innovative approach to surface polishing for SRF cavity applications. Journal of Manufacturing and Materials Processing, 7(2), 62. doi:https://doi.org/10.3390/jmmp7020062
Singal, N. (2023, May 14). Best CEOs: How Ashish Bharat Ram became instrumental in writing SRF’s success story: Ashish Bharat Ram has navigated SRF through tough times, never losing faith in its capabilities and employees. Business Today, Retrieved from https://www.proquest.com/magazines/best-ceos-how-ashish-bharat-ram-became/docview/2811806952/se-2