Author: Nivya Kuniyil
Batch: Finance 2 Roll no: 21230023176
Introduction:
Nykaa is an Indian e-commerce company headquarters in Mumbai. It sells beauty, wellness and fashion products through its website , mobile app, and over 100 physical stores. In 2020,it became the first Indian unicorn startup headed by a woman
Nykaa sells products which are manufactured in India as well as internationally. In 2015, the company expanded from online-only to an omnichannel model and began selling products apart from beauty. As of 2020, it retails over 2,000 brands and 200,000 products across its platforms.
Objectives:
To calculate beta and its significance.
Views And Reviews:
One of the most significant advantages of Nykaa is its extensive product range. From skincare and makeup to haircare and wellness products, Nykaa offers a vast array of choices for its customers. Nykaa stocks products from both renowned international brands and emerging local brands. This gives customers a mix of options at various price points. Nykaa’s website and mobile app are user-friendly, making it easy for customers to browse and purchase products.
In many urban areas, Nykaa offers quick delivery services, which has been appreciated by customer.Nykaa is known to have responsive customer service, addressing queries and concerns efficient.
Like many e-commerce platforms, Nykaa has faced concerns related to the authenticity of products. It’s crucial for consumers to ensure they purchase from verified sellers to avoid counterfeit products. Nykaa has largely been viewed positively for its vast product range, user-friendly interface, and customer service. However, like any e-commerce platform, it also has areas where it can improve, particularly in ensuring product authenticity and refining its post-purchase processes.
Data collection:
Data was downloaded from nseindia.com for 01/10/2022 to 30/09/2023 for Nifty as well as for Nykaa. All the columns were deleted for both the sheets except date and closing price and the Friday closing price were found for both. Returns for X and Y were calculated, X being Nifty 50 and Y being Nykaa. Finally, data analysis was done.
Data Analysis:
Equation: Return on Nykaa =226.43+2.016 Return on Nifty 50
t-stat for b = 3.2086
R Square = 0.1796
F = 10.295
The above equation shows the relationship between Nifty 50 and Nykaa .Return of Nykaa is dependent variable and Return of Nifty 50 is independent variable. Positive sign means if Nifty 50 increases Nykaa also increases. If Nifty 50 price rises by 1 unit, Nykaa share price will rise by 2.016 and vice versa. No of observation are 49. Figure which is written in bracket that is (3.2086) is t- stat for b. The P value for which is 0.002406 which means Nifty 50 is statistically significant at 2% level. R square 0.1796 is which mean 17.96 of variances in Nykaa share price are explained by Nifty 50 in other words 0.6565 is error means 65.65% is due to the variables which are not in the model. F is 10.291. Overall model is statistically significant.
Conclusion:
Beta is 2.1066 which is more than 1, therefore it is good for Short Term Investment.