RELATIONSHIP OF THE PHOENIX MILLS LIMITED WITH NIFTY 50
Author: Pallavi Patil
Introduction: THE PHOENIX MILLS LIMITED
The Phoenix Mills Limited is one of India’s leading retail-led, mixed-use property development companies, with a strong focus on developing and managing large retail malls, hospitality, and commercial spaces. Established in 1905, it initially operated as a textile mill in Mumbai before transforming into a real estate developer in the early 2000s. Over the years, Phoenix Mills has expanded its portfolio with iconic properties like High Street Phoenix in Mumbai and other major malls across India. Its stock is listed on the NSE and BSE, attracting investor interest due to its consistent growth in the retail real estate sector. The company is also known for its diversification into hospitality and commercial office spaces, making it a key player in India’s urban infrastructure development.
Objective: To find out Beta (β) of The Phoenix Mills Limited and its Significance.
Data Collection:
I have downloaded the data for NIFTY50 and The Phoenix Mills Limited for the duration of 01-06-2023 to 31-05-2024 from the NSE website. Using this data, I found the weekly closing prices for Fridays. Subsequently, I calculated the weekly returns based on these prices.
Weekly returns were calculated by the formula,
Y(t+1) – Y(t) / Y(t)*100
Weekly return of Nifty was taken as X.
Weekly return of The Phoenix Mills Limited is taken as Y.
Y was Regressed on X
Data Analysis:
Regression equation:
Weekly Return of The Phoenix Mills Limited =
Y (Intercept) and The Phoenix Mills Ltd + NIFTY 50 (weekly return of nifty)
Relationship of Nifty 50 and The Phoenix Mills Ltd
= -1.01 + (-0.68) Weekly return of Nifty 50
(-1.28){t-stat})
N = 48, R-Square = 0.030, F = 1.4823, P-value = 0.2056
The above equation shows the relationship between Nifty 50 and The Phoenix Mills Ltd, positive sign before the co-efficient of Nifty 50 tells us that there is a positive relationship if nifty rise by 1unit , company will rise by 0.68 and vice versa.
The figure in bracket is t stats as (-1.28) for beta. The p value for which is 0.2056 which is less than 0.05 meaning beta is statistically significant.
For N=48, R-Square =0.030 which means 3% of The Phoenix Mills Ltd return are explained by Nifty 50. Other (97%) are variable explained not in model.
F=1.4823 and P-value for that variable is 0.2056, it is more than 0.05 meaning overall model is not statistically significant at 5% level.
Conclusion:
As per the given data of RELATIONSHIP OF THE PHOENIX MILLS LIMITED WITH NIFTY 50. We know that: β value < 1 and Negative, indicates that the company exhibits lower volatility compared to the market. This characteristic suggests that The Phoenix Mills Ltd may be a favorable option for long-term investment, as it tends to be more stable during market fluctuations. Consequently, an investment in The Phoenix Mills Ltd is deemed beneficial from a risk-return perspective.