Title: Relationship between Nifty and PVR INOX Limited
Author: Pranali Londhe
Introduction: PVR INOX Limited (formerly Priya Village Roadshow Ltd), formerly known as PVR CINEMAS, is an Indian multiplex chain based in Mumbai. It was formed as a result of the merger between PVR Cinemas and INOX Leisure Multiplex. PVR pioneered the multiplex revolution in India by establishing the first multiplex cinema in 1997 at Saket, New Delhi. PVR offers a range of services to enhance the movie-watching experience. They have various types of screens like IMAX, 4DX, and GOLD CLASS for a premium. In 2022, PVR Cinemas achieved the milestone of completing 25 years in the business.
Objective: To calculate the beta of PVR INOX Limited to see its significance
Literature review:
Commenting on the unveiling, Ajay Bijli, Managing Director, PVR Inox, said, “We are delighted to introduce our second cinema in Ajmer, bringing a world-class cinematic experience to the residents of this vibrant city. With the biggest 4-screen cinema in Ajmer, equipped with the latest technology and design elements, we aim to revolutionize the movie-watching experience for discerning audiences in Ajmer. Our focus remains on accelerating growth in underserved markets strategically expanding our footprint to Tier-2 and Tier-3 cities.”
“We are excited to bring about the unique and proprietary concept of cinema pods to India with this exclusive tie-up with PVR,” said Chican, founder and president of Oma Cinema. “Our designs ensure that each pod within an auditorium is unique and designed to perfection.”
“As a leading out-of-home entertainment destination, we are keen on building cinemas with more experiential elements which is not possible in a home environment setting,” added Pramod Arora, Chief Growth and Strategy Officer, PVR. “Besides the most advanced cinematic technology, we have always been at the forefront of design architecture and innovative concepts, to ensure that our patrons get to experience the magic of movies and create happy memories every time they visit the cinemas. Many corporates have been used to their own box at sporting events in stadiums and now they shall have an option to have one in a cinema too.”
Data Collection: The data for Nifty and Equity of PVR INOX Limited has been downloaded from nseindia.com from 1st February 2023 to 1st January 2024. Data was manipulated to calculate the Friday closing price of Nifty 50 as X and for the returns of equity of PVR INOX Limited as Y.
Data Analysis:
Y (Equity of PVR INOX LIMITED) was regressed on X (Nifty 50)
Data Equation of PVR INOX LIMITED = -0.4385 + 0.5949 Nifty
N= 48
R2 = 0.068
F = 3.3612
Interpretation:
- The above equation shows the relationship between PVR INOX Limited and Nifty 50.
- If Nifty rises by 1 unit, PVR INOX will rise by 0.5949 units.
- The T stat for B is 1.833 and the P value is 0.0732 which is greater than 0.05, meaning Nifty does not impact PVR INOX Limited.
- R2 is 0.068, meaning 6.8% of PVR INOX Limited is explained by Nifty, 93.2% of PVR INOX depends on other variables that are not in the error model.
- F =3.3612 and P the value is greater than 0.05, so the model is not statistically significant at the 5% level.
Conclusion:
As the beta is 0.5949 which is less than 1 so the company is good for long-term investment.
Reference:
PVR inox unveils ajmer’s largest 4-screen cinema. (2024, Jan 29). Business World, Retrieved from https://www.proquest.com/magazines/pvr-inox-unveils-ajmers-largest-4-screen-cinema/docview/2919305772/se-2
bureau, O. (2022, Apr 29). PVR in pact with oma cinemas to roll out opera type experience [companies]: Cost will be 25% higher than other screens, which ranges around ` 3-4 cr per screen. The Economic Times (Online) Retrieved from https://www.proquest.com/newspapers/pvr-pact-with-oma-cinemas-roll-out-opera-type/docview/2793848514/se-2
