Title: Relationship of Piramal Pharma Limited with Nifty 50.
Author: Pratik Umesh Mudholkar
Introduction:
Piramal Pharma Limited (PPL) is a global company that offers a range of products and services, including contract development and manufacturing (CDMO) services, hospital generics, and over-the-counter products. It’s basically a pharma company whose current share market price is 230.
Objective: To find out Beta of Piramal Pharma Limited and its Significance.
Data Collection: Values of Friday weekly close, then the weekly returns were found using (Y t+1 – Yt) / Yt *100.
Y = Piramal Pharma Limited.
X = Nifty 50
Y was regress on X
Data Analysis: Weekly returns of Piramal Pharma Limited = -0.63 + 1.49 of Nifty 50
(2.58) = t Stat
N = 48, R Square = 0.13, F = 6.64, P value = 0.013
Above equation shows relationship between Nifty 50 and Piramal Pharma limited. Positive science before the coefficient of Nifty 50 tells us that there is a positive relationship. If Nifty 50 rises 1 unit, then Piramal Pharma limited rises by 1.49 points and vice versa. Figure in bracket is that for t-stat and the P value which is 0.013 is less than 0.05 meaning beta is statistically.
N= 48, R square= 0.13 which means 13 % of Piramal Pharma Limited returns are explained by Nifty 50 and the balanced error are influenced by other variables
F= 6.64 and the P value is 0.013 it is less than 0.05 meaning overall model is statistically significant at 5 % level.
Conclusion:
β > 1 and positive (more than 1) means good for short term investments.