RESEARCH METHODOLOGY ASSIGNMENT
Relation between Nifty 50 and sonata software ltd Ltd
AUTHOR: – Shashikant Kumar (FINANCE- 1)
Roll. No.: –21230023239
Introduction: –
1986 Sonata was initially set up as a division of Indian Organic
Chemicals Ltd. and spun off into a separate company for a consideration in 1993. – As part of the growth strategy, the key strategic issue to be. addressed in the long term was to attract and retain employees. With this in mind, it was felt imperative to offer a substantive Stock. Option Plan which necessitated the formation of a separate company. 1994 The Sonata division of IOCL was spun off as an independent company. namely, Sonata Software Ltd., in October, for consideration of Rs. 8.14 Crores. Of this consideration, Rs. 1.75 Crore was allotted as fully paid-up equity (17,50,000 fully paid-up equity shares of Rs.
Objective: –
To Calculate Beta(β) and its significance of the equity stock of Sonata Software
Ltd.
Reviews: –
- 1. Company is growing so there will be many opportunities for others.
2.Company provides regular communication, listen and consider new ideas, and continually encouraging growth, both personally and professionally.
- This company promotes a healthy work-life balance through flexible scheduling, remote work options, or generous time-off policies, this can be a significant positive aspect.
- Company offers competitive salaries, bonuses, and comprehensive benefits packages.
- Company recognizes and rewards employee contributions through awards, bonuses, or other recognition programs.
- The company’s commitment to teamwork and collaboration, which can contribute to a positive and supportive workplace culture.
Cons
As an employee, I feel that this company lacks a clear vision or direction, it can be a source of frustration and uncertainty. Need to improve and concentrate on each employee.
Data Collection: –
Data was downloaded from nseindia.com for 01/11/2022 to 31/10/2023 for Nifty 50 as well as for sonata software Ltd. 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 Sonata Software Ltd. Finally, data analysis was done.
Weekly returns of Nifty 50 = X
Weekly returns of sonata software ltd Equity = Y
Number of observations of is .48 finally data analysis was done
Data Analysis: –
The regression equation has the form:
Y = a + b*X
Where, Y is the dependent variable,
X is the independent variable,
a is the intercept,
b is the slope.
In our case Sonata Software Ltd is the dependent variable and Nifty 50 is the independent variable.
Equation -return of sonata software ltd
Y (sonata software ltd) =-0.4962+0.78813*x (nifty 50)
(return of nifty 50)
Intercept, a = 0.788113
Slope, b =-0.0713
R Square = 0.04458
F = 2.146423
The above equation shows us the relationship between Sonata Software Ltd and Nifty 50. The positive sign indicates that if Nifty rises then the price of sonata software Ltd shares will also rise and vice versa. If Nifty rises one unit i.e., Nifty rises by one rupee then Equity will rise by 1.3934 and vice versa. t-stat for b (co-efficient of Nifty) is 1.465 and the p-value is 0.8240, statistically significant for Equity at 0.68% level. The number of observations is 48.
Conclusion: –
Beta is 0.07881, which is less than 1, it means Sonata Software Ltd is good for long -term investment.
Reference: –
https://en.wikipedia.org/wiki/Sonata_Softwares
Published 26th December 2023
By Shashikant Kumar
Edit Relationship of sonata software ltd with Nifty 50
Categorised as Finance
Tagged sonata software ltd , Nifty 50, REGRESSION
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