Title: Relationship of Dalmia Bharat Sugar and Industries LTD with Nifty 50.
Author: Deepam Shah
Introduction:
Dalmia Bharat Sugar and Industries Limited has been one of the fastest-growing success stories in the Indian sugar industry. The company’s foray into the sugar business was made in the mid-90s and the first unit of 2500 TCD was set up at Ramgarh, a village in the Sitapur district of Uttar Pradesh in 1994.
Objective: To find out Beta of Dalmia Bharat Sugar and Industries LTD and its Significance.
Data Collection: I have downloaded data for duration May 2023 to April 2024. Data was collected from NSEINDIA
Values of Friday weekly close, then the weekly returns were found using (Y t+1 – Yt) / Yt *100.
Y = Dalmia Bharat Sugar and Industries LTD
X = Nifty 50
Y was regressed on X
Data Analysis: Weekly returns of Dalmia Bharat Sugar and Industries LTD= 0.22 +0.51 of Nifty 50
(0.97) = t Stat
N = 48, R Square =0.20, F= 0.93, P value= 0.01
Above equation shows relationship between Nifty 50 and Dalmia Bharat Sugar and Industries LTD. A positive sign before the coefficient of Nifty 50 tells us that there is a positive relationship. If Nifty 50 rises 1 unit, then Dalmia Bharat Sugar and Industries LTD rises by 0.5 points and vice versa. The figure in bracket is that for t-stat and the P value which is 0.01 is less than 0.05 meaning beta is statistically significant.
N= 48, R square= 0.20 which means 20 % of Dalmia Bharat Sugar and Industries LTD returns are explained by Nifty 50 and the balanced error are influenced by other variables.
F= 0.93 and the P value is 0.01 it is less than 0.05 meaning the overall model is statistically significant at 5 % level.
Conclusion:
β< 1 and positive (less than 1) means good for long term investment.