AUTHOR: SURASHREE CHAKRABORTY
ROLL NO: 21230023127 (OPS & SCM)
INTRODUCTION:
Shree Cement is an Indian cement manufacturer, founded in Beawar, Rajasthan, in 1979. Now headquartered in Kolkata, it is India’s third largest cement producer and second largest cement company by market capitalisation. Shree Cement has moved in the last two decades from having 2 million tonne (mt) production capacity to becoming the country’s third largest cement player, with an installed capacity of 43.3 mt in India and 47.4 mt overseas. It also produces and sells power under the name Shree Power (Captive Power Plant) and Shree Mega Power (Independent Power Plant).
Since 2006, it has more than quadrupled its production capacity both by expanding into new areas and increasing the capacities of the existing plants. Shree Cement has been ranked 4th in 2017 Responsible Business Rankings developed by IIM Udaipur.
OBJECTIVE:
To Calculate Beta of Shree Cement and its significance.
VIEWS AND REVIEWS:
Steady Steps To Growth
We have steadily delivered returns on invested capital, progressively augmenting shareholder value. Our shareholders who have been with us since we went public in 1984 have seen their investment grow at an Internal Rate of Return (IRR) of 25.15% (as on 31st March, 2023). As the industry prepares to fuel a growing economy, we believe that our policies and practices will keep us steady and we will be able to maintain investors’ confidence in the company.
DATA COLLECTION:
Weekly returns are calculated.
Nifty: Independent Equity: Dependent
CONCLUSION:
SHREE CEMENT Returns:
y=−0.121718844+12.11930103× SHREE CEMENT Returns
Beta is more than 1 so we can invest in the company for short term or make the investment for less than 1 year.
y=−0.121718844+12.11930103×x
- Where:
- y represents the dependent variable (Shree Cement Returns)
- x represents the independent variable (Nifty 50 Returns)
Interpreting the coefficients:
- The intercept term (-0.121718844) indicates the expected Shree Cement return when Nifty 50 returns are zero. In this case, it suggests that Shree Cement returns are expected to be approximately -0.122% when Nifty 50 returns are zero.
- The coefficient of Nifty 50 returns (12.11930103) suggests the effect of a one-unit change in Nifty 50 returns on Shree Cement returns. Specifically, for every 1% change in Nifty 50 returns, Shree Cement returns are expected to change by approximately 12.12%.
Interpreting the statistical significance:
- The t-statistic for the coefficient of Nifty 50 returns is 0.815542039, and its associated p-value is 0.418790665. This p-value suggests that the coefficient of Nifty 50 returns is not statistically significant at conventional significance levels (e.g., 0.05). Therefore, based on the given data, we cannot conclude with confidence that there is a significant linear relationship between Nifty 50 returns and Shree Cement returns.
- Overall interpretation: Based on the regression equation and the statistical significance of the coefficients, the analysis suggests that there may not be a statistically significant linear relationship between Nifty 50 returns and Shree Cement returns. In other words, the returns of Nifty 50 may not be a reliable predictor of Shree Cement returns, at least based on the linear model represented by the equation provided.