Title: Relationship between Nifty Fifty and Vedanta Ltd.
Author: Vishal Kumar
Introduction: Vedanta is a leading global natural resources and technology conglomerate operating across India, South Africa, Liberia, and Namibia.
Vedanta has positioned itself as a leading natural resources and technology conglomerate, focusing on large scale expansion of its portfolio in India with operational excellence benchmarked to global standards.
Vedanta goal is to create long-term value for all our stakeholders through research, discovery, acquisition, sustainable development, and utilisation of diversified natural resources. For accomplishing that, we empower our people to drive excellence and innovation. We demonstrate world-class standards of governance, safety, sustainability, and social responsibility.
Objective: To calculate the Beta of Vedanta Limited and see its significance.
Views and Reviews: A review of Vedanta Ltd.’s literature reveals a complex picture of a major Indian player in natural resources, marked by both achievements and controversies. On one hand, its diverse portfolio, market leadership, and focus on sustainability garner praise for driving economic growth and self-reliance. On the other hand, environmental concerns surrounding mining practices, allegations of human rights violations, and past financial troubles raise critical questions about its social and environmental responsibility. Big personalities like environmentalist Sunita Narain and industry expert Anil Agarwal offer contrasting perspectives, highlighting the need for critical evaluation of Vedanta’s impact beyond mere economic metrics. Ultimately, understanding Vedanta requires navigating a web of diverse viewpoints to form a nuanced and informed opinion about its role in India’s development.
Data Collection: The data for Nifty Fifty and Equity of Vedanta LTD has been downloaded from http://nseindia.com/ and http://yahoofinance.com/ from 1st November, 2022 to 31st October, 2023. Data was manipulated to calculate the Friday closing price.
Data Analysis:
Y = 0.153028X + 0.857456
Interpretation:
The above equation shows the relation between Nifty50 and Vedanta LTD.
0.153028 is the Beta, representing the slope of the regression line. This means that for every one-unit increase in X, Y is estimated to increase by 0.153028 units.
Number of Observations are 49.
The value of R Square is 0.0040, which is very low. This means that only 0.4% of the variance in Vedanta Ltd. Stock price is explained by the Nifty 50 index. This indicates that Nifty 50 is not a good predictor of Vedanta Ltd. Stock price.
Adjusted R Square is -0.01716: The negative adjusted R-squared suggests that the model might be overfitting the data, and its predictive power might be even lower than the R-squared suggests.
Conclusion – In the context of the beta values provided 0.15 is less than 1. This suggests that the company’s stock tends to Lower volatility compared to the market. Lower volatility can indicate a potentially Low risky investment. The company might be considered more suitable for long-term investment.
