Author: Falguni Shukla.
Introduction: It was incorporated in 1945 by late shri. N. K. Firodia, freedom Fighter and pioneering industrialist. Force Motors is a fully vertically integrated automobile company, with expertise in design, development, and manufacture of the full spectrum of automotive components, aggregates, and vehicles.
Objectives: To calculate beta and its significance.
Views & Reviews: 1. Leading position in the domestic LCV passenger segment and diversified revenue. By – CRISIL.COM
- The company continues in the founder’s vision of providing efficient,utilitarian vehicles that empower the individual entrepreneur to meet his and the country’s ever changing needs. By – Naukri.com
Data collection:
- Data is downloaded from https://www.niftyindices.com/reports/historical-data , https://www.nseindia.com/get-quotes/equity?symbol=FORCEMOT for 1-10-2022 to 30-09-2023 period.
- Friday closing price have been found out.
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- Weekly return of Friday pricing considered.
- Weekly return of nifty are considered as “X”
- Weekly return of equity are considered as “Y”
Data Analysis: Return of Force- -14390.21239 – 0.885248108
(Return of Nifty 50)
R Square = 0.78749242 (13.19729447)
F = 174.1685814
Interpretation: In the above equation shows the relationship between Nifty 50 and Force Motors share. Return of Force Motors is dependent variable and Return of Nifty 50 is independent variable. Negative sign means if Nifty 50 price rises, Force Motors share price falls. If Nifty 50 price rises 1 unit, Force Motors share price will fall by 0.885248108 unit & vice versa. No of observation are 50. Figure which is written in bracket 13.19729447 is t test for b. The P value for which is 2.02486E-17 which means Nifty 50 is statistically insignificant at 5% level. R square is 0.78749242 which means 81.39% of variances in Force Motors share price are explained by Nifty 50 in other words 18.61% is error means 18.61% is due to the variables which are no in the model. F is 174.1685814. Overall model is statistically insignificant at 5% level.
Conclusion: Beta is -14390.21239 is less than 1 it means Force Motors is good for long term investment.
References: