RELATIONSHIP OF APOLLO TYRES LTD WITH NIFTY50
AUTHOR: ARNESH NAMAN (021330024071)
INTRODUCTION: Apollo Tyres Ltd.
Founded in 1972, is a leading global tyre manufacturer headquartered in Gurugram, India. The company produces tyres for various vehicle segments, including passenger cars, trucks, and two-wheelers. It has a strong presence in over 100 countries with manufacturing units in India, Europe, and Southeast Asia.
As per the market data, ‘Apollo Tyres’ stock trades on the NSE and BSE, with share prices fluctuating around ₹350-₹400, reflecting its steady performance in the automotive industry.
Object: To find out the beta (β) of Apollo tyres and its significance.
Data Collection: The data was collected by taking the weekly return of NSE (National Stock Exchange) , NIFTY50 and Apollo tyres of dated time period of 1 year from 1st May 2023 to 30th April 2024 with the help of NSE site. Friday closing price and weekly return was calculated by formula.
Weekly return of Nifty was taken as (X) in terms of company (Apollo tyres) as Y is taken. Y was regressed on X.
Data analysis: Regression equation; Y ( Intercept)= Apollo tyres+ NIFTY 50
Relationship of Nifty 50 and Apollo Tyres = 0.37 + 0.114 (2.471{t-stat})
N = 48, = 0.117, F = 6.106, P(VALUE)= 0.0172
The above equation shows the relationship between Nifty 50 and Apollo Tyres, positive sign before the co-efficient of Nifty 50 .Tells us that there is a positive relationship if nifty rise by 1unit , company will rise by 0.38
And vice versa as the co-efficient of t stats as (2.471) for beta. The p value for which is 0.041 which is less than 0.05 meaning beta is statistically significant.
N=48, =0.117 which means 11.7% of Apollo Tyres return are explained by Nifty 50. Other (88.3%) are variable explained not in model.
f= 6.106 and p value for that variable is 0.041,it is less than 0.050 meaning overall model is statistically significant at 5% level.
Conclusion: As per the given data of RELATIONSHIP OF APOLLO TYRES LTD WITH NIFTY50. We know that:- beta value <1 and positive , means company (Apollo Tyres) is good for long term investment. Showing interest in investment is beneficial.
