Title: Relationship between Nifty 50 and Spencer’s Retail Limited
Author: Surajkumar Jha (71)
1. Introduction:
Spencer’s Retail Limited, a part of the RP-Sanjiv Goenka Group, is a leading multi-format retailer in India, operating over 120 outlets in 35+ cities, including a significant footprint in East India and Uttar Pradesh. The company, which has a history of 1863, operates its business under the philosophy of “Makes Fine Living Affordable.
2. Objective:
To calculate Beta and observe its significance
3. Literature Review:
3.1 Report on the Study at Dr. A.S. Rao Nagar with Reference to Spencer’s Retail Ltd:
Gupta (2010), asserts that Spencer’s Retail will struggle in a price war against discount retailers, making cost-leadership untenable. The company must focus on upper-middle-class customers willing to pay for ambiance, hygiene, and gourmet products. Key high-margin categories like fresh produce, meat, and experiential shopping are vital for maintaining profitability. The conclusion is that Spencer’s should adopt an omnichannel, premium-differentiation strategy to maximize wallet share from loyal customers instead of pursuing risky geographic expansion.
3.2 Supply Chain analysis of Spencer’s Retail Limited in Bangalore city:
Prakash (2014), asserts in his research that empirically dissects Spencer’s fresh produce supply chain, revealing that defective handling and inefficient transportation lead to a massive 40% spoilage rate in perishables before they even hit the store shelves.
4. Data Collection:
Data for Nifty 50 And Spencer’s Retail Limited was downloaded from NSE India’s website for the period of 1/1/2025 to 31/12/2025. The Data was manipulated to get Friday closing prices of Nifty 50 and Spencer’s Retail Limited. Weekly returns were calculated. Weekly returns of Nifty 50 are named as X and weekly returns of Spencer’s Retail Limited were named as Y. Y was regressed on X.
5. Data Analysis:
The equations indicated the relationship between Market Return (X) and Spencer’s Return (Y). The R Square value is 0.3043, which means 30.43% of the variance in Spencer’s Return is explained by Market Return. 69.57% is the error for the variables which are not included in the model. F value is 20.53. P-value of which is 0.000048, which is less than 0.05, hence the model is statistically significant at 5% level. P-value of coefficient = 0.000, which is less than 0.05, hence the market return has a significant impact on Spencer’s return. Intercept = -1.7307, which means if market return is 0, then the return on Spencer’s is -1.7307%. Coefficient of market return (Beta) is 1.3738, which means for every 1 unit increase in market return, Spencer’s return increases by 1.3738 units. No. of observations are 48.
6. Conclusion:
Since, the Beta for this company is 1.3738, this stock is strictly a short-term play to be traded only when we expect the Nifty to rise.
7. Reference:
1. Gupta, A. K. (2010). A Project Report on the Study at Dr. A.S. Rao Nagar with Reference to Spencer’s Retail Ltd on Market Potential and Customer Preferences. ICBM-School of Business Excellence, Hyderabad.
2. Prakash, K.C. (2014). An analysis of supply chain of tomato from farm to retail outlets for spencers retail outlets in Bangalore city. International Journal of Commerce and Business Management, 7(2), 243-250.
