Title: Relation of Dom’s Industries with Nifty50
Author: Divya Mandlik
Introduction:
Dom’s Industries Limited is a leading Indian stationery and art supplies manufacturer, known for its high-quality pencils, pens, erasers, sharpeners, crayons, and other writing instruments. Established in 1976 and headquartered in Umbergaon, Gujarat, India, the company has grown into one of the most recognized stationery brands in India and international markets. Dom’s has built a strong reputation for innovation, durability, and affordability, catering to students, artists, and professionals. The company operates in over 40 countries, exporting its products globally. In 2022, Italian stationery giant FILA Group acquired a majority stake in Dom’s, further strengthening its global presence. With a focus on technological advancement and quality, Dom’s continues to expand its product portfolio and market reach, making it a key player in the stationery industry.
Objective:
To find out the Beta of Dom’s Industries
Literature Review:
Dom (2024) stated that the Thai automotive industry’s development is shaped by the interaction between policy rents and global value chain (GVC) rents, influencing firms’ ability to generate economic rents—profits above baseline returns. While policy rents, such as government incentives, have facilitated foreign investments, they have not effectively enhanced local firms’ technological capabilities, leaving them in subordinate roles. As the industry matures, established players capture more benefits from policy rents, especially during transitions like the shift to new energy vehicles (NEVs), further consolidating their dominance. Without incentives for technological innovation, local firms often resort to non-productive rent-seeking behaviours, such as lobbying for protective policies, instead of investing in competitiveness. This highlights how state intervention, while crucial, must be strategically designed to strengthen domestic innovation rather than reinforce existing power structures. Future research should explore how emerging economies can create policies that foster local technological advancements and long-term competitiveness in evolving industries.
Mark (2003) presents that Research on LAN equipment pricing highlights significant cost reductions driven by technological advancements and market competition. Using hedonic regression models, studies show that prices for routers, switches, LAN cards, and hubs declined by 17% annually between 1995 and 2000, reflecting improvements in network capacity and efficiency. This decline contrasts with the relatively stable Producer Price Index (PPI) for communications equipment, suggesting that traditional price indices may overlook rapid technological progress. Factors such as semiconductor advancements and economies of scale further contributed to cost reductions. Future research can explore how emerging technologies like cloud networking and software-defined networking (SDN) influence price trends.
Data Collection:
Dom’s Industries and Nifty50 data was download for period 1-1-24 to 31-12-24 and data was manipulated to find out the Friday closing prices were calculated of Nifty50 = X and Dom’s Industries = Y, Y was regression on X
Data Analysis:
Equation: Dom’s Industries = 1.4010 + 1.1346 Nifty50
Interpretation: The regression equation describes the relationship between Nifty50 (X) and Dom’s Industries share price (Y), indicating that Dom’s Industries share price is the dependent variable, and Nifty50 is the independent variable. The positive coefficient of 1.1346 suggests that for every one-unit increase in Nifty50, Dom’s Industries share price is expected to increase by 1.1346 units. With 47 observations (N=47), the model’s R-squared value: 0.0897, implying that approximately 8.97% of the variation in Dom’s Industries share price can be explained by changes in Nifty50, leaving 91.03% of the variation attributable to other factors not include in the model. The p-value for the slope is 0.0409, which is less than the conventional threshold of 0.05, indicating that the relationship between Nifty50 and Dom’s Industries share price is statistically significant at the 5% level. Consequently, this model provides strong evidence to suggest a significant linear relationship between Nifty50 and Dom’s Industries share price.
Conclusion:
Dom’s Industries beta of 1.1346 indicates that it is more volatile than the market and better suited for short-term investment.
Reference:
Dom Kandpinijsha, 2024. “Economic Rent Dynamics in the Thai Automotive Industry: State Allocation During GVC Transition,” RAIS Conference Proceedings 2022-2024 0475, Research Association for Interdisciplinary Studies.
Mark Doms & Chris Forman, 2003. “Prices for local area network equipment,” Working Paper Series 2003-13, Federal Reserve Bank of San Francisco.