TOPIC: RELATIONSHIP BETWEEN NIFTY 50 AND VIP INDUSTRIES LTD
AUTHOR: VINAY VIJAYKUMAR KAKADE
INTRODUCTION: VIP Industries Limited is amongst Asia leading manufacturers and suppliers of luggage, backpacks, and handbags and the market leader in the organised luggage segment. The Company has a range of leading brands, positioned across the entire price range, catering to value (Aristocrat), mid (VIP, Sky bags), and premium (Carlton, Caprese) price points. Promoted by Mr. Dilip G Piramal, the companies manufacturing infrastructure includes two state-of-the-art units in India and six in Bangladesh which are equipped with modern technologies.
OBJECTIVE : To calculate Beta and find Significance
DATA COLLECTION: Data for NIFTY 50 and VIP INDUSTRIES LTD was downloaded from NSE site for the period from 01-03-2023 to 28-02-2024,Friday closing prices were calculated and weekly return of VIP INDUSTRIES LTD were regressed on weekly return of NIFTY 50.
DATA ANALYSIS: VIP INDUSTRIES LTD =0.372 + 0.190 NIFTY 50, n=48, R^2=0.006, F=0.2855, P-VALUE=0.59
The above equation shows the relationship between weekly return of NIFTY 50 and VIP INDUSTRIES LTD. The positive sign means there is direct relationship if weekly return of NIFTY 50 rises then weekly return of VIP INDUSTRIES LTD will also rise and vice-versa, if weekly return of NIFTY 50 rises by one unit, weekly return of VIP INDUSTRIES LTD will also rise by 0.190 units vice-versa. T-stat for b is 0.53441 and the p-value for which is 0.59 which is more than 0.05 meaning b is not statistically significant at 5% level. Number of observations are 48, R^2 is 0.006 meaning 0.6% of VIP INDUSTRIES LTD is explained by NIFTY 50, balance 99.4% is error due to variables not taken into in the model. F is 0.2855,p-value for which is 0.59 which is more than 0.05, so the overall model is not statistically significant.
CONCLUSION: The Beta is less than 1, VIP INDUSTRIES LTD is good for long-term investment.