Author- Aman Mall Batch– F1 Roll no. 021330024048 Name of the COLLEGE – ITM Business School Kharghar.
Introduction- Ambuja Cement has recently seen volatility in its share prices. Ambuja Cements, a leading player in the Indian cement industry, has been making headlines recently due to its strategic initiatives aimed at expanding production capacity and enhancing sustainability. The company is focusing on increasing its green energy usage and reducing carbon emissions, aligning with global sustainability goals. Recent stock reports indicate a positive trend, reflecting investor confidence amid rising demand in the construction sector. Additionally, Ambuja’s recent acquisition moves aim to strengthen its market position in a competitive landscape.
Objective- To find out the Beta value of Ambuja Cement Limited and it’s Significant.
Data collection- Historical data of Ambuja Cement Limited and Nifty 50 has been collected from the NSE website with the time period of 1st May,2023 to 30th April ,2024. The data had been somewhat manipulated to get only Friday closing price, weekly returns of my company and the same for the NIFTY 50. The first weekly return value has been taken as X for NIFTY 50 and Y for the Ambuja Cement Limited. The next weekly return value has been calculated using excel formula, then at last my company i.e. Ambuja Cement Limited has been regressed on NIFTY 50.
Data analysis: Weekly Returns of Ambuja Cement = -0.1878 + 1.5778 Weekly returns of NIFTY 50.
T STAT = 4.6517
N = 48, R2 = 0.3199, F Value = 21.6384, P Value = 0.0000
Interpretation- The above equation depicts the relationship between weekly returns of Ambuja Cement and weekly returns of NIFTY 50. The (+) sign before the coefficient of NIFTY 50 tells us that if NIFTY 50 rises, Ambuja Cement also rises. The figure of T STAT for BETA of NIFTY 50 rises by 1 unit than the Ambuja Cement returns are expected to increase by 1.5778%. The figure of T STAT for BETA and the P Value for which is 0.0000 which is less than 0.05 meaning BETA is statistically significant.
R2 is 0.3199 meaning 31.99% of company returns are explained by NIFTY 50. Dearing 68% maybe due to the fundamentals. F Value = 21.6384, P Value = 0.0000 means overall the model is statistically significant
Conclusion- As the BETA of Ambuja Cement is more than 1, one should invest for short term in this company.