Author: Vansh Nimkar
Introduction: –
Vedanta Limited is a globally diversified natural resources company headquartered in India. It is one of the leading producers of various metals and minerals, including zinc, lead, silver, copper, iron ore, aluminum, and oil and gas. The company has a significant presence in India as well as in various other countries around the world.
Data Collection:
Data for NIFTY 50 and Vedanta Limited has been downloaded from NSE 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 Vedanta Limited were regressed on weekly returns on NIFTY 50.
Data Analysis:
Y = 0.27410947+1.311033884 X
The above equation shows relationship between weekly returns of Vedanta Limited and Nifty 50. Negative sign means inverse relationship, if price rises demand falls and vice versa.
T-stat for b is 1.999752876 and the p value is 0.051452504 which is more than 0.05, meaning b is not statistically significant at 5% level, meaning price does not play a significant role for demand. Numbers of observations are 48.
R-square is 0.079981812, meaning 7%% of Vedanta Limited share is explained by the movement in Nifty, Balance meaning 93% is error due to the variables not taken in the model.
F is the 3.999011564 P value for which is 0.779700169 which is more than 0.05 so the overall model is not statistically significant.
Conclusion: –
As beta = 1.311033884, is more than 1, therefore company is good for short term investment.