Relationship of Voltas with Nifty50.
Author: Vani Choudhary.
- Intro: Voltas Limited is an Indian multinational home appliances company headquartered in Mumbai. It designs, develops, manufactures, and sells products including air conditioners, air coolers, refrigerators, washing machines, dishwashers, microwaves, air purifiers, water dispensers. Voltas is India’s largest air conditioning company by market share. The company was incorporated on 6 September 1954 in Mumbai, as a collaboration between Tata Sons and Volkart Brothers. The company is currently chaired by Noel Tata and Pradeep Bakshi is the company’s current chief executive officer and managing director.
- Objective: To calculate Beta and its significance.
- Views and Reviews: Voltas is a well-known brand in the air conditioning industry and is generally regarded as a reputable and reliable manufacturer. They have been in the market for several decades and have built a strong reputation for producing quality air conditioners. One of the key advantages of Voltas air conditioners is their focus on innovation and technology. They incorporate advanced features like turbo cooling, intelligent sensors, energy-saving modes, and smart connectivity options, which can enhance the cooling experience and provide convenience to users. Additionally, Voltas air conditioners are known for their durability and performance.
- Data collection: Nifty and Voltas closing prices were collected from NSE website. The weekly return of Nifty is termed as “X” and weekly return of Voltas is termed as “Y”.
- Data Analysis:
- Equation: Y=0.1084+0.9927x
- Interpretation: The above equation shows the relation between Nifty50 and Voltas.
Return of Voltas is dependent variable and return of Nifty50 is independent variable.
Positive sign means if Nifty50 rises by 1 unit then share price of Voltas will also rise by 0.99 and vice-versa.
Number of observations are 50.
27.38 is the t-stat for Y, the p-value for which is 0.00.
R square is 0.9398 which means 93% of variances in Voltas are explained by Nifty.
F is 749.87, p-value for this is 0.00 which means model is statistically significant at 1% level.
- Conclusion: Beta is 0.9927 which is less than 1, it means that Voltas is good for long-term investment.
- Reference:
https://www.nseindia.com/