Title: Relationship between sula vineyards limited and nifty 50.
Author: Sahil Patil
Introduction: –
Sula Vineyards is one of India’s leading wine producers, located in Nashik, Maharashtra. Founded in 1999 by Rajeev Samant, Sula played a significant role in putting Indian wines on the global map. It’s known for its wide range of wines, from Sauvignon Blanc to Shiraz, and for its picturesque vineyard tours and events. Sula has contributed to the growth of wine tourism in India and has won numerous awards for its quality wines.
Data Collection:
Data for NIFTY 50 and Sula vineyards has been downloaded from Yahoo website for Period of 1st March 2023 to 28th February 2024, Friday closing prices were calculated and weekly returns was found out. Weekly Returns of Sula vineyards were regressed on weekly returns on NIFTY 50.
Data Analysis:
Format of regression equation is Y= α + β(X)
Equation of regression of weekly returns of Sula vineyards on weekly returns of nifty50 index –
Where,
Number of observations: 48,
R square = 0.017584046,
F =0.82334382,
P-value = 0.228410957,
Interpretation:
· The above equation shows relationship between weekly returns of Sula vineyards and weekly returns of Nifty 50 Index.
· Positive sign means direct relation, meaning if weekly returns of Nifty 50 Index rise then weekly returns of Sula vineyards also rises and vice-versa.
· If weekly returns of Nifty 50 Index rise by 1-unit, weekly returns of Sula vineyards will rise and vice-versa.
· Figure in bracket shows t-stat for β, P-value for which is 0.368933, which is less than 0.05 meaning β is statistically significant at 5% significance level.
· Number of Observations are 48, R-square value is 0.017584046 meaning approximately 1% of weekly returns ofSula vineyards are explained by weekly returns of Nifty 50 Index. Balance 99% (approximate) is error due to other variables which are not in the model.
· F is 0.823344, the P-value of which is 0.368933, which is less than 0.05 meaning overall, the model is statistically significant at 5% significance level.
Conclusion: –
As beta = 0.411043583, is less than 1, therefore company is good for long term investment