Title: Relationship of South Indian Bank Ltd. And Nifty 50.
Author: Shrushtii Rathi.
Introduction: South Indian Bank Ltd, a prominent private sector bank in India, has demonstrated steady growth in the financial sector. From April 1, 2023, to March 31, 2024, its share performance was relatively stable, supported by improving asset quality, consistent earnings, and a focus on expanding its retail and SME banking segments. While its growth trajectory may be considered moderate compared to more aggressive stocks, its lower volatility makes it an appealing option for conservative investors. Those seeking stability and consistent returns may find South Indian Bank Ltd a more reliable choice over higher-risk investments.
objective: To find out Beta of South Indian Bank Ltd.and its significance.
Data Collection : Data for Nifty 50 and South Indian Bank Ltd. was downloaded from NSE site from the period 1-4-2023 to 31-3-2024. The Data was manipulated to get Friday closing price and weekly returns were calculated by using formula (Yt-1 – Y t) Yt * 100. Weekly returns of South Indian Bank Ltd. were regressed on weekly return of Nifty 50.
Data Analysis: weekly return of South Indian Bank Ltd.= 0.57 + weekly return of Nifty 50= 0.08
=2.2351
N=45, R2=0.1040, F=4.9958 , P Value=0.0306
The above equation shows the relationship between Nifty 50 and South Indian Bank Ltd.. The positive sign before 0.08 means if Nifty 50 rises South Indian Bank Ltd. will also rise and vice versa. The coefficient of Nifty 50 has tstat=2.2351and P value of which is 0.0306 It is less than 0.05 meaning Nifty 50 is statistically significant to increase the prices of South Indian Bank Ltd. R2=0.1040 meaning 0.1% of Adani Power prices are explained by Nifty 50, 99% depends upon other factors like fundamentals. F=4.9958 and the P-value for this is 0.0306 meaning it is less than 0.05 means overall model is not statistically significant.
Conclusion: As 0.08 is in positive relationship, it is advisable to invest in this stock for long term.