Relationship of Nifty 50 Index with PAGE INDUSTRIES Limited
Author: prakash dhage
Introduction:
PAGE INDUSTRIES Limited is an Indian adhesives manufacturing company based in Andheri (East), Mumbai.[4] The company is the dominant and leading adhesives company in India.[5] Pidilite also manufactures products across verticals such as art materials and stationery; food and fabric care; car products, adhesives, and sealants; and speciality industrial products like adhesives, pigments; textile resins, leather chemicals, and construction chemicals.[6]
Pidilite markets the Fevicol range of adhesives. Its other brands are FeviKwik, Dr. Fixit, Roff, Cyclo, Ranipal, Hobby Ideas, M-seal, and Acron. It also markets and manufactures WD-40 in India.[7]
The company has manufacturing facilities across India including in Mahad (Maharashtra), Vapi (Gujarat), Baddi and Kala Amb (both in Himachal Pradesh).
Objective: To find Beta (β) of PAGE INDUSTRIES Limited and its significance
Data Collection:
Nifty 50 Index and PAGE INDUSTRIES Limited data was collected from nseindia.com website for the period of one year dating from 1st February 2023 to 31st January 2024. The historical data collected was manipulated using Microsoft Excel to get Friday closing prices of both, the index and the company. Weekly returns were based on the closing prices were calculated using Excel tools and with use of Regression analysis, weekly returns of PAGE INDUSTRIES Limited were regressed on weekly returns of Nifty 50 Index.
Data Analysis:
Equation of regression of weekly returns of PAGE INDUSTRIES Limited on weekly returns of Nifty 50 Index-
Format of Regression equation is Y = α + β(X)
weekly returns of PAGE INDUSTRIES Limited = 0.1873 – 0.0770 × weekly returns of Nifty 50 Index
Where, ( -0.2602 )
Number of Observations = 48,
R Square = 0.0015,
F = 0.067712,
P-value = 0.795859
Interpretation-
• The above equation shows relationship between weekly returns of PAGE INDUSTRIES Limited Company and weekly returns of Nifty 50 Index.
• Negative sign means inverse relation, meaning if weekly returns of Nifty 50 Index rise then weekly returns of PAGE INDUSTRIES Limited Company falls and vice-versa.
• If weekly returns of Nifty 50 Index rise by 1-unit, weekly returns of PAGE INDUSTRIES Limited Company will fall by – 0.0770 unit and vice-versa.
• Figure in bracket shows t-stat for β, P-value for which is 0.795859 , which is greater than 0.05 meaning β is not statistically significant at 5% significance level.
• Number of Observations are 48, R-square value is 0.0015 meaning approximately 0.15 % of weekly returns of PAGE INDUSTRIES Limited are explained by weekly returns of Nifty 50 Index. Balance 99.85 % (approximate) is error due to other variables which are not in the model.
• F is 0.067712 , the P-value of which is 0.795859, which is greater than 0.05 meaning overall, the model is not statistically significant at 5% significance level.
Conclusion:
As β (- 0.0770) is less than 1, it is good to invest in PAGE INDUSTRIES Limited for long term.