Title: Sony Industries
Author: Shubham Jadhav
Introduction:
Sony Corporation is a multinational conglomerate headquartered in Tokyo, Japan, and a global leader in consumer electronics, gaming, entertainment, and financial services. Founded in 1946, Sony is known for its innovations in electronics, including televisions, audio systems, and PlayStation gaming consoles. It also has a strong presence in the music, film, and semiconductor industries. Sony’s diversified portfolio and technological advancements make it a significant player in the global market.
Objective:
To find out the Beta of Sony Corporation and its significance.
Literature Review:
Bruche (2010) stated that the paper analyzes Sony’s transformation from an electronics manufacturer to a diversified global conglomerate. It highlights Sony’s strategic resource acquisitions, internal capability building, and expansion into entertainment and financial services. The study emphasizes the role of Sony’s strong brand identity, research and development investments, and adaptability to technological trends. It concludes that Sony’s success is driven by continuous innovation, market expansion, and strategic collaborations, enabling it to maintain its global competitiveness.
Tyabji (2015) stated that the paper explores the evolution of frugal engineering in Japan, tracing its origins to post-war industrial policies. It highlights how Japanese firms, including Sony, developed cost-effective, high-quality products through lean manufacturing and efficient resource utilization. By leveraging innovation and streamlined production, companies like Sony improved efficiency and product development. The study concludes that frugal engineering is a strategic approach that allows Japanese firms to compete globally while maintaining affordability and quality.
Data Collection:
Sony Corporation and Nikkei 225 data were downloaded for the period 1-1-24 to 31-12-24, and the data was manipulated to find out the Friday closing prices of Nikkei 225 = X and Sony Corporation = Y. Y was regressed on X.
Data Analysis:
Equation: Sony Corporation = -0.2568 + 1.4125 Nikkei 225
Interpretation: The regression equation describes the relationship between Nikkei 225 (X) and Sony Corporation share price (Y), indicating that Sony Corporation’s share price is the dependent variable, and Nikkei 225 is the independent variable.
The positive coefficient of 1.4125 suggests that for every one-unit increase in Nikkei 225, Sony’s share price is expected to increase by 1.4125 units.
With 47 observations (N=47), the model’s R-squared value: 0.3128, implying that approximately 31.28% of the variation in Sony’s share price can be explained by changes in Nikkei 225, leaving 68.72% of the variation attributable to other factors not included in the model.
The p-value for the slope is 0.00012, which is less than the conventional threshold of 0.05, indicating that the relationship between Nikkei 225 and Sony’s share price is statistically significant at the 5% level. Consequently, this model provides strong evidence to suggest a significant linear relationship between Nikkei 225 and Sony Corporation’s share price.
Conclusion:
Sony Corporation’s beta of 1.4125 indicates that it is more volatile than the market and may be better suited for short-term investment.
Reference:
Bruche, Gert, 2010. “Sony’s transformational resource acquisition path: A case study of latecomer catch-up in a diversified business context,” Working Papers 55, Berlin School of Economics and Law, Institute of Management Berlin (IMB).
Tyabji, Nasir, 2015. “From Post-War Industrial Policies to Frugal Engineering: Some Initial Propositions,” MPRA Paper 63483, University Library of Munich, Germany.
