Relationship of NIFTY 50 With Suzlon Energy Limited
Author: Suyog Jadhav
Introduction: Suzlon Energy Limited is a leading renewable energy company based in India, specializing in the design, development, and manufacturing of wind turbine generators (WTGs). Founded in 1995 by Tulsi Tanti, Suzlon has grown to become one of the largest wind energy companies globally. The company provides end-to-end solutions, including wind farm development, operations, and maintenance services. Suzlon’s commitment to sustainable energy has led to its strong presence in key markets across Asia, Europe, and the Americas. With a focus on innovation and environmental responsibility, Suzlon continues to play a significant role in the global renewable energy sector.
Objective: To find out the Beta of Suzlon Energy Limited and find its significant.
Literature Review:
Working Capital Management at Suzlon Energy Ltd. Pune
Kaakandikar & Kulkarni (2020) stated, This paper focuses on Suzlon Energy’s working capital management practices and how they impact the company’s profitability. It analyzes financial data from Suzlon’s annual reports to evaluate liquidity ratios, working capital turnover, and overall financial health. The study reveals that while Suzlon manages its working capital efficiently, there are fluctuations in liquidity levels over time. Effective management of working capital is crucial to maintaining financial stability, especially in a capital-intensive industry like renewable energy. The research suggests that Suzlon’s working capital management plays a significant role in its ability to meet short-term obligations while investing in growth. The study emphasizes the need for further improvements in liquidity management to enhance operational efficiency and profitability.
Balancing the Power Equation: Suzlon Energy Limited
Awate , Mudambi et al (2015) present, A This case study delves into Suzlon’s strategic initiatives, particularly its acquisition of REpower, a German wind turbine manufacturer. It discusses the challenges Suzlon faced in integrating advanced wind turbine technology from REpower while expanding its global market reach. The study highlights Suzlon’s effort to become more competitive in the global renewable energy sector by incorporating innovative technologies. However, the integration of the two companies was not without difficulties, particularly in aligning different operational cultures and business models. Despite these challenges, the acquisition enabled Suzlon to strengthen its technological capabilities and expand its
Data Collection:
Data for Suzlon Energy ltd. 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 Suzlon Energy Ltd as Y.
Data Analysis:
Equation: Suzlon Energy Ltd = 0.008 + 1.778 Nifty50
Interpretation: The regression equation describes the relationship between Nifty50 (X) and Suzlon’s share price (Y), indicating that Suzlon’s share price is the dependent variable, while Nifty50 is the independent variable. The positive coefficient of 1.778 suggests that for every unit increase in Nifty50, the Suzlon share price is expected to increase by 1.778 units. With 46 observations (), the value is 0.20334, implying that approximately 20.33% of the variation in Suzlon’s share price can be explained by changes in Nifty50. The F-value for the model is 11.48557. The p-value for the slope is 0.001, which is less than the conventional threshold of 0.05. This indicates that the relationship between Nifty50 and Suzlon’s share price is statistically significant at the 5% level. Consequently, this model provides evidence to suggest a significant linear relationship between Nifty50 and Suzlon’s share price.
Conclusion:
Suzlon beta of 1.78 indicates that it is more volatile than the market and better suited for short term investment.
References:
Awate S., Mudambi R., & Narain A. (2015). Indian School of Business Case Study.
Kaakandikar R., & Kulkarni V. M. (2020). Studies in Indian Place Names, 40(60), 7671-7676.