Relationship of Nifty with Power grid corporation limited.
Author Name : Pratik Mahajan
Introduction to power grid
Power Grid Corporation of India Limited is an Indian central public sector undertaking under the ownership of the Ministry of Power, Government of India. It is engaged mainly in transmission of bulk power across different states of India. It is headquartered in Gurugram. Power Grid transmits about 50% of the total power generated in India on its transmission network. Its original name was the “National Power Transmission Corporation Limited”, was charged with planning, executing, owning, operating and maintaining high-voltage transmission systems in the country. On 8 November 1990, the firm received its Certificate for Commencement of Business. Their name was subsequently changed to Power Grid Corporation of India Limited, on 23 October 1992.
Objective:
The objective of this study to determine the beta value of power grid corporation Limited relative to Nifty 50 index. Beta measure the Stocks volatility compared to the market. This analysis will help investors assess the risk associated With power grid stocks and make informed investment decision.
Literature Review: The Future of Electrical Power Grids: A Direction Rooted in Power Electronic
The future of electrical power grids, focusing on how power electronics will play a key role in their transformation. Traditional power grids, which have been mainly centralized, are evolving into more decentralized systems to accommodate modern technologies like renewable energy, electric vehicles, and smart grids. A significant part of this transformation involves hybrid AC/DC grids, which combine both alternating current (AC) and direct current (DC) systems to improve efficiency and flexibility. Another important technology discussed is solid-state transformers (SSTs), which can replace traditional transformers, offering better control and support for future power grids. The paper also highlights unified power electronics systems, which integrate different energy sources and improve power management. These systems help in reducing the number of power converters, increasing efficiency, and supporting power grid stability. Overall, the study suggests that the future power grid will be more adaptable, efficient, and reliant on advanced power electronics technologies to ensure sustainability and reliability.
Power System Oscillations with Different Prevalence of Grid-Following and Grid-Forming Converters
This paper explains how the way electricity is controlled in power systems is changing due to modern technology. Traditionally, power systems were dominated by machines called synchronous generators, which helped keep the electricity supply stable. However, with the rise of renewable energy sources like solar and wind, power electronics-based systems are becoming more common. These systems use power converters, which come in two types: Grid-Following (GFL) Converters and Grid-Forming (GFM) Converters.
- Grid-Following Converters rely on the existing power grid to function. They adjust themselves based on the grid’s voltage and frequency but don’t directly support stability.
- Grid-Forming Converters actively create and regulate the voltage and frequency of the power system, making them more suitable for renewable energy.
Data Collection:
Data for power grid and Nifty 50 was downloaded for the period from 1st January 2024 to 31st December 2024 the data was manipulated to calculate the Friday closing prices for both indices. The Nifty 50 was represented as X and power grid as Y. A linear regression was performed where Y was regressed on X.
Data Analysis :
Equation : Power grid Corporation of india limited : = 0.083 + 0.217 Nifty50
Interpretation : The regression equation (Y = 0.083 + 0.217X) describes the relationship between Nifty50 (X) and Power grid corporation share price (Y), indicating that Power grid`s share price is the dependent variable, while Nifty50 is the independent variable. The positive coefficient of 0.217 suggests that for every unit increase in Nifty50, the Power grid share price is expected to increase by 0.217 With 47 observations ((N = 47)), the model’s R-squared value is 0.23425. The p-value for the slope is 0.7040 which is greater than the conventional threshold of 0.0005, indicating that the relationship between Nifty50 and Power grid share price is not statistically significant at the 5% level. Consequently, this model does not provide strong evidence to suggest a significant linear relationship between Nifty50 and power grid share price.
Conclusion : Beta of 0.217 indicates that it is less volatile than the market and better for the long term investment.
Reference :
Vitor Monteiro & Joao L. Afonso, 2023. “The Future of Electrical Power Grids: A Direction Rooted in Power Electronics,” Energies, MDPI, vol. 16(13), pages 1-10, June.
Rossano Musca & Francisco Gonzalez-Longatt & Cesar A. Gallego Sánchez, 2022. “Power System Oscillations with Different Prevalence of Grid-Following and Grid-Forming Converters,” Energies, MDPI, vol. 15(12), pages 1-19, June