TITLE<\/u>:-\u00a0 Relationship of Pedilite industries with Nifty-100 and to calculate beta.<\/p>\n
AUTHOR<\/u>:- PRAPTI SATYAWAN PATEKAR<\/p>\n
INTRODUCTION<\/u>:- Pidilite Industries, a well known name in adhesives market, was incorporated in 1969. Pidilite Industries is the market leader in adhesives and sealants, construction chemicals, hobby colours and polymer emulsions in India. Over two\u2013third of the company\u2019s sales come from products and segments it has pioneered in India. The company has diversified in various segments such as adhesives and sealants, construction and paint chemicals, automotive chemicals, art materials, industrial adhesives, industrial and textile resins and organic pigments and preparations. It has created brands like Fevicol, Dr Fixit, Cyclo, hobby ideas, Roff and M\u2013Seal. To facilitate better global networking, Pidilite Industries has established offices \/ subsidiaries in several countries including Singapore, USA, Brazil, UAE, Saudi Arabia, Indonesia, Egypt, Bangladesh, UK, Kenya, South Africa and Ghana.In India it has subsidiaries namely Bhimad Commercial Company and Madhumala Traders. Pidilite also established a state\u2013of\u2013the\u2013art research centre in Singapore that is now a member of Singapore Chemical Industry Council (SCIC).<\/p>\n
OBJECTIVE<\/u>:- To calculate beta and see its significance.<\/p>\n
LITERATURE<\/u> REVIEW<\/u>:-<\/p>\n
A) Market indices are benchmark portfolios that represent the performance of all the companies in the market. Hence, the index can be considered the proxy of the market portfolio which is the combination of all the risky securities in the market. In this case, the Nifty mid-cap 100 index represents the mid-cap segment of the NSE. According to the capital market line of the Capital Asset Pricing Model, the market portfolio is also a part of the risk-return line depicting all the fairly priced optimum portfolios of the market. This would mean that all the portfolios on the capital market line which lie to the left of the market portfolio would have a lower return and risk combination than the market portfolio and all the portfolios which lie to the right would have a higher risk-return combination than the market portfolio. However, the Sharpe single-index model helps the investor to identify a portfolio that has a higher return than the market portfolio with a lower risk than the market portfolio during the same period. The optimal portfolio using the Sharpe model has a mean return of 50.76 percent per year and a risk of 12.861 percent, whereas the index portfolio has a return of 15.61 percent and a very high risk of 23.02 percent. Hence, it can be inferred that investors would be better off investing in a portfolio suggested by the Sharpe model rather than investing in the market index made up of the top 100 mid-cap companies. It also gives a perspective on over-diversification. The Nifty mid-cap 100 index gave lower returns for a higher level of risk.<\/p>\n
B) The studies that have been conducted on the implications of change in promoter shareholding so far have not looked at the specific universe that this study focuses on, namely the small-cap value universe. This study comes up with some interesting results for this particular universe. In our study, within the specified universe, while one-year returns had no relationship with a change in promoter shareholding, two-year returns had a negative relationship with a change in promoter shareholding. This inference may be consistent with the results of some of the research literature discussed earlier in this paper. Our results may be consistent with the results of the study by Kumar and Singh (2013), who argue that a minimum threshold promoter holding in a firm is needed for a positive relationship with the firm\u2019s performance, which, in turn, could impact stock price performance. Thus, small-cap-value investors may be advised to avoid stocks where the promoter holding is significantly low. Our results could be consistent with the results of the study by Selarka (2006), who observes that firm performance increases with an increase in the promoter shareholding but peaks at a particular point and then dips. Another work with which the results of this paper could be consistent is that by Jameson et al. (2014), who state that firms in which promoters have a significant controlling power exhibit poor corporate governance and firm performance. Thus, small-cap-value investors may avoid stocks where promoter control is unusually high.<\/p>\n
\u00a0<\/p>\n
\u00a0<\/p>\n
DATA<\/u> COLLECTION<\/u>;- The data of Pidilite industries and Nifty 100 was downloaded from nsied.com for the company Pidiite industries, as it is listed in Nifty 100 index. The historical data of the company was extracted from the above website. The period dated from 1st<\/sup> November,2022 to 31th October,2023 was taken and manipulated particularly Friday\u2019s closing price for nifty and equity. Considering Nifty100 as \u2018X\u2019 and Pedilite industries as \u2018Y\u2019 were regressed.<\/p>\n \u00a0<\/p>\n DATA<\/u> ANALYSIS<\/u>:- \u00a0<\/p>\n Pidilite Industries= 98.88 + 0.125NIFTY value\u00a0 statistically<\/p>\n n= 48, R-square=0.89 , F= 380.93<\/p>\n The above equation shows the relationship of Pidilite Industries with Nifty 100<\/p>\n If Nifty rises by 1 unit, Pidilite Industries will rise 0.125 unit<\/p>\n t-stat for b is 19.517 and the p value is 1.80\u00a0 which is more than 0.05 so b=0, meaning Nifty does not impact Pidilite Industries shares<\/p>\n – square is 0.89<\/p>\n F = 380.93, and p Value\u00a0 is 1.80 more than 0.66, so the model is not statistically significant at 5% level.<\/p>\n Conclusions :-<\/u><\/p>\n As beta (0.125) is less than 1, so good for long term investment.<\/p>\n References :-<\/u><\/p>\n a)Mistry, J., & Khatwani, R. A. (2023). Examining the superiority of the sharpe single index model of portfolio selection: A study of the indian mid-cap sector. Humanities & Social Sciences Communications, 10(1), 178.<\/p>\n b)Khatwani, R., Raghuram, G., Mishra, M., & Mistry, J. (2023). Impact of change in promoters\u2019 shareholding pattern on the performance of small-cap-value equity stocks in the national stock exchange of india. Journal of Risk and Financial Management, 16(1), 32.<\/p>\n","protected":false},"excerpt":{"rendered":" TITLE:-\u00a0 Relationship of Pedilite industries with Nifty-100 and to calculate beta. AUTHOR:- PRAPTI SATYAWAN PATEKAR INTRODUCTION:- Pidilite Industries, a well known name in adhesives market, was incorporated in 1969. Pidilite Industries is the market leader in adhesives and sealants, construction chemicals, hobby colours and polymer emulsions in India. Over two\u2013third of the company\u2019s sales come… Continue reading Relationship of Pedilite industries with Nifty-100 and to calculate beta.<\/span><\/a><\/p>\n","protected":false},"author":138950,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[46],"tags":[],"class_list":["post-18978","post","type-post","status-publish","format-standard","hentry","category-investing","entry"],"_links":{"self":[{"href":"http:\/\/www.sachdevajk.in\/index.php?rest_route=\/wp\/v2\/posts\/18978","targetHints":{"allow":["GET"]}}],"collection":[{"href":"http:\/\/www.sachdevajk.in\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/www.sachdevajk.in\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/www.sachdevajk.in\/index.php?rest_route=\/wp\/v2\/users\/138950"}],"replies":[{"embeddable":true,"href":"http:\/\/www.sachdevajk.in\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=18978"}],"version-history":[{"count":1,"href":"http:\/\/www.sachdevajk.in\/index.php?rest_route=\/wp\/v2\/posts\/18978\/revisions"}],"predecessor-version":[{"id":18979,"href":"http:\/\/www.sachdevajk.in\/index.php?rest_route=\/wp\/v2\/posts\/18978\/revisions\/18979"}],"wp:attachment":[{"href":"http:\/\/www.sachdevajk.in\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=18978"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/www.sachdevajk.in\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=18978"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/www.sachdevajk.in\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=18978"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}