Author: Lavisha Nawal
Introduction: LTIMindtree operates in over 30 countries with a global workforce of more than 90,000 employees. The company serves 700+ clients across various industries, including banking, healthcare, and retail. It achieved annual revenues exceeding $4 billion in 2023. LTIMindtree is a publicly traded entity listed on the NSE and BSE in India.
Objective: To find out beta of LTI MINDTREE and its significance
Data collection: The data of Nifty 50 and LTIMindtree was downloaded from NSE website, i.e., nseindia.com for the period of 1-6-23 to 31-5-24. The data was shaped to find out Friday’s closing price and its Weekly returns were calculated. Weekly return [(yt+1 – yt)/yt*100] of Nifty 50 was termed as X and of LTIMindtree as Y. Then, Y was regressed on X.
Data analysis: Regression Equation=
Weekly return of LTIMindtree= 0.84+0.79 weekly return of nifty
T Stat = 2.06 (1.63)
N= 46
R2 = 0.08
F = 4.02
P-value = 0.051
The above equation shows the relationship between Nifty 50 and Weekly return of LTIMindtree . The positive sign before the coefficient of weekly return of nifty tells us that there is a positive relationship. If Nifty rises by 1 unit, LTIMindtree will rise by 0.79 units and vice versa.
Figure in the bracket is t-stat for beta and p-value is 0.051,which is less than 0.05 meaning that model is statistically significant.
R2 is 0.08, which means only 8% of weekly returns of Company are explained by Nifty.
F= 4.02 and p-value for that is 0.051 meaning the overall model is statistically significant.
Conclusion: As the beta of LTIMindtree (0.79) is less than 1 but positive, it would be advisable to invest for the long term.