Title: Relationship of Nilkamal Ltd with Nifty 50
Author: Neha Prasad
Introduction:
Nilkamal Limited is a leading Indian company and a well-known name in the furniture and plastic products industry. Established in 1985, the company initially focused on plastic moulded products and later expanded into furniture solutions. Nilkamal is recognized as the world’s largest manufacturer of moulded plastic furniture and Asia’s largest processor of plastic moulded products. The company offers a wide range of products including plastic and wooden furniture, material handling solutions, mattresses, and lifestyle furnishings. Its product portfolio caters to households, offices, institutions, and industrial clients. Nilkamal has built a strong brand presence through innovation, quality, and affordability. The company operates through a vast distribution network across India. It also exports its products to several international markets, strengthening its global footprint. Nilkamal Limited is listed on both the NSE and BSE, reflecting its strong corporate standing. Over the years, the company has maintained market leadership by continuously adapting to changing consumer needs and industry trends.
Objective:
To calculate Beta of Nilkamal ltd and observe its significance in relation to Nifty 50
Literature Review:
According to Abesco (2018), beta is an important measure of systematic risk that captures the sensitivity of a stock’s returns to market movements. A higher beta indicates greater volatility relative to the market, while a lower beta suggests more stable returns. The study highlights that beta plays a crucial role in portfolio diversification and investment decision-making.
Literature Review 2
Abesco (2020) explains that regression analysis using market returns as the independent variable is a widely accepted method for estimating beta. The study also emphasizes the importance of testing the statistical significance of beta using t-statistics and p-values to ensure that the relationship between stock returns and market returns is not due to random fluctuations.
Data Collection:
Data for Nilkamal and Nifty 50 was downloaded from NSE India.com for the period 01.12.2024 – 30.11.2025. Friday closing prices were found out, weekly returns of Nifty 50 and Nilkamal were calculated. Weekly returns of Nifty 50 were taken as X and weekly returns of Nilkamal were taken as Y. Y was regressed on X.
Data Analysis:
Y= -0.654 +0.427X
N=48
R square = 0.071
F-value = 3.507
P-value = 0.067
The above regression equation shows the relationship between the weekly returns of Nilkamal Industries Ltd and the weekly returns of the Nifty 50 index. The beta value of 0.428 indicates a positive relationship between the company’s returns and market returns. This implies that if Nifty 50 returns increase by 1 unit, the returns of Nilkamal Industries Ltd increase by 0.428 units, showing that the stock is less volatile than the market.
The t-statistic for beta is 1.873, and the p-value is 0.067, indicating that the beta coefficient is statistically significant at the 10% level of significance, but not at the 5% level. The R² value of 0.071 indicates that only 7.1% of the variation in Nilkamal’s returns is explained by movements in the Nifty 50, while the remaining 92.9% variation is due to firm-specific and other external factors not included in the model.
The F-statistic value of 3.507 with a p-value of 0.067 suggests that the regression model is moderately significant as a whole.
Conclusion:
Since the beta of Nilkamal Industries Ltd is less than 1, the stock is less volatile than the market. Therefore, it is suitable for long-term investment purposes if the Nifty 50 is expected to rise, as it offers relatively stable returns with lower market risk.
References
Abesco. (2018). Understanding beta and market risk in equity investments. Abesco Financial Research Publications.
Abesco. (2020). Regression analysis and systematic risk measurement. Abesco Academic Series.