Title: Relationship of Nifty50 with DABUR INDIA Limited
Author: DISHA GUPTA
Introduction:
This study explores the statistical dependency between Dabur India Limited, a global leader in Ayurvedic healthcare, and the NIFTY 50, India’s benchmark stock market index. As a prominent player in the Fast-Moving Consumer Goods (FMCG) sector, Dabur is traditionally classified as a defensive stock. These securities are characterized by stable demand and lower volatility, often moving independently of broader economic cycles that drive the NIFTY 50.
Objective:
Calculation of beta of DABUR INDIA Limited and observe its significance.
Literature Review:
1. Empirical Assessment of Beta and Market Sensitivity –
A quantitative study conducted in 2025 by Peruka & Ramakrishna analyzed the risk-return profiles of leading FMCG stocks, including Dabur, against the NIFTY 50 benchmark. The researchers found that while the FMCG sector is traditionally “defensive,” individual stocks exhibit varying degrees of market responsiveness. Specifically, the literature suggests that Dabur often maintains a low Beta (ranging between 0.23 and 0.81), which classifies it as a low-volatility asset. The study concludes that Dabur’s stock price is less sensitive to systematic market shocks compared to high-beta sectors like Banking or IT, making it a preferred choice for risk-averse investors seeking portfolio stability during bearish market cycles.
2. Sectoral Correlation and Unsystematic Risk Drivers –
Research by Venkata Lakshmi Suneetha (2024) and subsequent market reports in late 2025 highlight that the correlation between FMCG stocks like Dabur and the NIFTY 50 has weakened over time. This literature argues that Dabur’s performance is increasingly decoupled from broad market trends and is instead driven by unsystematic factors, such as rural demand recovery, monsoon patterns, and raw material inflation. Technical and regression analyses of Dabur’s historical data often show a negligible R-square value, suggesting that the NIFTY 50 index explains only a tiny fraction of the stock’s price movements. Consequently, researchers emphasize that investors should focus more on company-specific innovations and agricultural output rather than general market indices when forecasting Dabur’s future returns.
Data Collection:
The data of Nifty 50 and the data for DABUR 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 DABUR INDIA Limited. Weekly return was calculated by the formula (Yt+1-Yt)/Yt*100 and then weekly returns of the Nifty 50 was taken as X and the equity of DABUR INDIA Limited was taken as Y. Y was regressed on X.
Data Analysis:
DABUR INDIA LTD = -40.4271 – 0.7645(NIFTY 50)
The above regression equation explains the relationship between the dependent variable (stock returns) and the independent variable (X Variable 1) using 47 observations.
- The coefficient of X Variable 1 is negative (-0.7645), indicating an inverse and weak relationship between the variable and the dependent outcome. This implies that a one-unit increase in X Variable 1 leads to an average decrease of approximately 0.7645 units in the output, though the statistical evidence suggests this relationship is not reliable.
- The t-statistic for the coefficient is -0.0366 with a p-value of 0.9710, which is far above the 1% and 5% levels of significance. This confirms that the coefficient is not statistically significant, indicating that movements in X Variable 1 do not have a meaningful or strong influence on the returns.
- The R-square value of 0.0000298 (expressed as 2.98E-05) shows that approximately 0.003% of the variation in the returns is explained by changes in X Variable 1, reflecting a negligible explanatory power of the regression model.
- The F-statistic of 0.00134 with a significance value of 0.9710 indicates that the overall regression model is not statistically significant, confirming the absence of a strong linear relationship between the variables.
Conclusion:
- The regression analysis indicates a very weak and statistically insignificant relationship between the stock and the market index (X Variable 1). The estimated beta coefficient ($beta$ = -0.7645) is negative but not statistically significant (P-value = 0.9710), suggesting that we cannot confirm the stock’s returns move in the opposite direction of the market with any certainty. The beta value reflects negligible market sensitivity, implying the stock’s movements are largely independent of systematic risk factors.
- With an R² value of 0.0000298, a negligible proportion (0.003%) of the variation in the stock’s returns is explained by movements in the index, indicating almost no market dependence and that the returns are driven almost entirely by firm-specific factors or random noise. The insignificant F-statistic (Significance F = 0.9710) confirms the extreme weakness of the regression model. Overall, the stock does not behave as a market-aligned security, meaning its performance is likely uncorrelated with the broader market.
References:
- Peruka, M., & Ramakrishna, R. (2025). A Quantitative Study on Risk and Return of Leading FMCG Stocks with Reference to Nifty50. International Journal of Emerging Technologies and Innovative Research.
- Venkata Lakshmi Suneetha (2024). Comparative Analysis of Volatility and Sensitivity in FMCG and IT Stocks: An Empirical Study. Journal of Management Research and Ana