Relationship of Steel Authority of India with Nifty 50
1 F2 2024-26 – 021330624099, ITM Business School, Kharghar, Maharashtra, India
Corresponding Author E-mail: Prachirai290@gmail.com
Title: Relationship Steel Authority of India with Nifty 50
Author: Sanjhi Sisodia
Introduction:
The Steel Authority of India Limited (SAIL) is one of India’s largest steel-making companies and a public sector enterprise, founded in 1954. Headquartered in New Delhi, SAIL operates several integrated steel plants across India, producing a wide range of steel products for industries like construction, railways, defense, and energy. It is known for contributing significantly to India’s infrastructure development and for its focus on innovation, sustainable practices, and quality in steel production. SAIL is a Maharatna company, highlighting its importance in the Indian economy.
Objective:
To find out beta of Steel Authority of India and its significance.
Data collection:
Data for Nifty 50 and Steel Authority of India was downloaded from http:/www.nseindia.com/ for Current year i.e. 1-4-23 to 31-3-24.
Data was manipulated to get Friday closing prices and weekly returns were calculated by the formula (yt-1 – yt)/yt*100
Weekly returns of Steel Authority of India was regressed on weekly returns of Nifty 50.
Data Analysis:
Weekly returns of Polycab = -1.02+0.24
0.468(T-stat weekly return of Nifty 50)
N=46, R Square = 0.0049, F= 0.219, P value= 0.64
The above Equation shows the relationship between Nifty 50 and Steel Authority of India . The positive sign before 0.24 means, if Nifty 50 rises, Steel Authority of India will also rise and vice-versa. The coefficient of Nifty 50 has T-stats=0.468 and the P value of which is 0.641. It is more than 0.05 meaning Nifty 50 is not statistically significant to increase the price of Steel Authority of India. R square = 0.0049 meaning 0.0049% of Steel Authority of India prices are explained by Nifty 50, 99.99% depends upon other factors like fundamentals are other factors. F is 0.219 and the P value for this 0.64, meaning it is more than 0.05, Meaning the overall model is not statistically significant.
Conclusion:
Weekly Coefficient is 0.24, this value is less than 1 but positive means Steel Authority Of India is good for long term investment .