Title: Relationship Of Nifty with Coal India Limited (CIL)
Author: Chaitanya Gandhe
Introduction:
Coal India Limited (CIL) is a Government of India–owned Maharatna enterprise and the world’s largest coal producer. Established in 1975 and headquartered in Kolkata, CIL operates under the Ministry of Coal and supplies coal primarily to India’s power and core industrial sectors. Through its subsidiary companies, CIL plays a central role in ensuring national energy security while increasingly focusing on sustainable and efficient mining practices.
Objective:
Calculation of beta of Coal India Limited and observe its significance.
Literature Review:
View 1: Sutha Vaiyapuri, S.Ramaswamy, R.Seerengarajan and S. Manivel (2022)- A Study on the Financial Health of Coal India Limited
Financial health of any company can be easily evaluated through its profitability, liquidity and solvency. The Z-Score is one of the competent tools to evaluate the financial soundness of a company. The main objective of this paper is to check the bankruptcy and to examine the financial distress of Coal India Limited (CIL) using Z-Score. For this purpose, the Altman Z-Score for a period of ten years from 2010–11 to 2019–20 has been calculated. It has been observed that the company is in the safe zone for six years, i.e., from 2010-11 to 2015-16, which means the company may or may not go into bankruptcy and thereafter the score has come down below the score level of 1.80, indicating financial distress conditions of the CIL.
View 2: Dr. P. Pirakatheeswari, N. Bharath Kumar (2007)- A Study On Financial performance Of Coal India Limited
Finance is an integral aspect of every business, and the success of an organization depends on how competently it manages the funds available to it. There are many stakeholders in a company, including trade creditors, bondholders, investors, employees, and management, and each group has its own interest in tracking the financial performance of the company. Understanding financial performance is essential because most crucial organizational decisions depend on financials. Financial performance analysis is the process of determining the operating and financial characteristics of a firm from accounting and financial statements to assess the efficiency and performance of management.
Data Collection:
The data of Nifty 50 and the data for Coal India Limited was downloaded from 01-12-2024 to 30-11-2025 form NSE India.com. This data is used for finding out the Friday closing prices for Nifty 50 and Coal India Limited and then weekly returns of the Nifty 50 was taken as X and the equity of Coal India Limited was taken as Y. Y was regressed on X.
Data Analysis:
Coal India Limited Returns (Y)= -17.8643 + 0.000746 NIFTY 50 (X)
· The above regression equation explains the relationship between the dependent variable (stock returns) and the independent variable (NIFTY 50 index values) using 49 weekly observations.
· The negative sign means inverse relationship which means if NIFTY50 rises Coal India Limited fall and vice versa. If NIFTY50 rises with 1 unit Coal India Limited will fall by 0.000746 units, the p value for NIFTY50 is 0.088119 which is not less than 0.01 which means NIFTY50 is not statistically significant at 1% level. No. of observations are 48. R Square is 0.061914 which means 6.1% of the variances of Coal India Limited are explained by NIFTY50. 93.9% is the error which is due to the variables which are not in the model. F is 3.035995 and the P value for which is 0.088119 which is not less than 0.01. overall model is not statistically significant at 1% level.
Conclusion:
Beta is 0.0007, which is less than 1, so it is good for long term investment in Coal India Ltd.
References:
· Sutha Vaiyapuri, S. Ramaswamy, R. Seerengarajan & S. Manivel. (2022). A Study on the Financial Health of Coal India Limited. International Journal of Research and Analytical Reviews (IJRAR), Volume 9, Issue 3, August 2022.
· Dr. P. Pirakatheeswari & N. Bharath Kumar. (2007).
A Study on the Financial Performance of Coal India Limited.
Research Paper, India.