Author: Ashwin Dhumal
Introduction: An Indian provider of financial services, Arihant Capital Markets Ltd. provides a comprehensive array of investment and financial solutions. Since its founding in 1992, the business has developed into one of India’s most well-known brokerage and investment companies. Arihant Capital helps businesses with fundraising, corporate finance, and initial public offerings (IPOs).To guarantee that their clients have a flawless trading experience, they have made investments in mobile apps and digital platforms. Arihant Capital Markets Ltd. is renowned for its dedication to providing excellent client service, strong technological foundations, and research-based methodology.
Objective: To find out beta of Arihant Capital Markets Ltd. and its significance
Data collection: The data of Nifty 50 and Arihant Capital Markets Ltd. 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 Arihant Capital Markets Ltd. as Y. Then, Y was regressed on X.
Data analysis:
Regression Equation=
Weekly return of Arihant Capital Markets Ltd. = -01.61 + 0.16 weekly return of nifty
(1.38)
N= 48
R2 = 0.04
F = 1.90
P-value = 0.16
The above equation shows the relationship between Nifty 50 and Weekly return of Arihant Capital Markets Ltd. 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, Arihant Capital Markets Ltd will rise by 0.16 unit and vice versa.
Figure in bracket is t-stat for beta and p-value is 0.16, which is more than 0.05 meaning that model is not statistically significant.
R2 is 0.04, which means only 4% of weekly return of Company are explained by Nifty.
F= 1.90 and p-value for that is 0.16 meaning it is more than 0.05 meaning the overall model is not statistically significant.
Conclusion: As the beta of Arihant Capital Markets Ltd (0.16) is less than 1 but positive, it would be advisable to invest for long term.