TITLE :RELATIONSHIP OF GAIL INDIA WITH NIFTY 50.
AUTHOR: GANDHAR KASLIWAL
INTRODUCTION: GAIL (India) Limited, established in 1984, is a state-owned natural gas company headquartered in New Delhi. It is a key player in India’s energy sector, involved in the transmission, distribution, and marketing of natural gas, along with petrochemicals. GAIL operates one of the largest natural gas pipeline networks in the country, facilitating efficient gas transportation.GAIL INDIA LTD HAS A MARKET CAPITALIZATION OF 225.40 CR
GAIL India has been trading in the price range of 233.25 & 221.95. THE CURRENT DIVIDEND YIELD OF GAIL INDIA LTD IS 1.37%.
OBJECTIVE: TO FIND OUT BETA OG GAIL LTD AND ITS SIGNIFICANCE.
DATA COLLECTION; DATA OF NIFTY 50 AND GAIL LTD WAS DOWNLOADED FROM NSE WEBSITE FOR THE PERIOD FROM 1ST MAY 2023 TO 30TH APRIL 2024.DATA WAS MANIPULATED TO GET FRIDAY CLOSING PRICES AND WEEKLY RETURNS WERE CALCULATED BY THE FORMULA
WEEKLY RETURNS OF NIFTY 50 ARE REPRESENTED AS X AND OF MY COMPANY ARE REPRESENTED AS Y. WEEKLY RETURNS OF MY COMPANY WERE REGRESSED ON WEEKLY RETURNS OF NIFTY 50.
DATA ANALYSIS: WEEKLY RETURNS OF NESCO -0.30- 1.37.WEEKLY RETURNS OF NIFTY 50 (4.03).
N=48 R2=261.4 F=16.280 P=0.020.
INTERPRETATION: THE ABOVE EQUATION SHOWS THE RELATIONSHIP BETWEEN NIFTY 50 AND GAIL INDIA LTD.THE POSITIVE SIGN BEFORE THE COEFFICENT OF WEEKLY RETURNS OF NIFTY 50 MEANS THERE IS A POSITIVE RELATIONSHIP. IF NIFTY 50 RISES BY 1 UNIT GAIL INDIA LTD WILL INCREASE BY 1.37% AND VICE VERSA. THE COEFFICENT OF NIFTY 50 HAS t-stat=(4.03),AND THE P VALUE OF WHICH IS 0.020 WHICH IS LESS THAN 0.05 MEANING BETA IS STATISTICALLY SIGNIFICANT AT 5%LEVEL AND N=48,NO.OF OBSERVATONS ARE 48. R2 IS 261.4 WHICH MEANS 2.61% OF WEEKLY RETURNS OF GAIL INDIA LTD ARE EXPLAINED BY NIFTY50.97.39% DEPENDS UPON OTHER FACTORS LIKE FUNDAMENTALS AND MORE ARE OTHER FACTORS.F=16.28 AND THE P VALUE OF THIS IS 0.020 MEANING IT IS LESS THAN 0.05 MEANING THE OVERALL MODEL IS STATISTICALLY SIGNIFICANT AT 5% LEVEL.
CONCLUSION: BETA IS POSITIVE(1.37),SO INVEST FOR LONG TERM.