{"id":22745,"date":"2025-03-25T18:04:53","date_gmt":"2025-03-25T12:34:53","guid":{"rendered":"http:\/\/www.sachdevajk.in\/?p=22745"},"modified":"2025-03-25T18:04:53","modified_gmt":"2025-03-25T12:34:53","slug":"relationship-of-britannia-with-nifty-50-2","status":"publish","type":"post","link":"http:\/\/www.sachdevajk.in\/?p=22745","title":{"rendered":"Relationship of Britannia with NIFTY 50"},"content":{"rendered":"

Report : Relationship of Britannia with NIFTY 50<\/span><\/p>\n

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Author: <\/span>Binod Rawat<\/span><\/p>\n

Roll No: <\/span>48<\/span><\/p>\n

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Introduction<\/span><\/p>\n

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Britannia Industries Ltd. is one of India’s leading food companies, specializing in bakery products such as biscuits, bread, and dairy items. As a part of the NIFTY 50 index, Britannia holds a strong market presence with a reputation for consistent revenue growth and consumer loyalty. Given its defensive nature as a Fast-Moving Consumer Goods (FMCG) stock, it tends to exhibit moderate market sensitivity compared to highly cyclical sectors.<\/span><\/p>\n

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However, Britannia\u2019s stock movement is influenced by commodity prices, consumer demand, and broader economic conditions. This study aims to determine the \u03b2 (Beta) of Britannia with respect to NIFTY 50 to assess its market sensitivity and risk profile.<\/span><\/p>\n

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Objective<\/span><\/p>\n

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To determine the beta (\u03b2) of Britannia Industries Ltd. relative to NIFTY 50 and analyze its market sensitivity, risk profile, and investment implications.<\/span><\/p>\n

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Literature Review<\/span><\/p>\n

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    Market Sensitivity of FMCG Stocks<\/span><\/p>\n<\/li>\n<\/ul>\n

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    According to Misra and Mohapatra (2015), FMCG stocks generally exhibit moderate correlation with broader market indices like NIFTY 50 due to their stable consumer demand, particularly during economic downturns.<\/span><\/p>\n

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      Performance of Consumer Stocks During Market Volatility<\/span><\/p>\n<\/li>\n<\/ul>\n

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      A study by Gali (2021) suggests that consumer goods stocks tend to perform well in times of market volatility, as non-discretionary demand for essential products remains steady. This characteristic makes Britannia a defensive stock, offering stability compared to cyclical stocks like banking or IT.<\/span><\/p>\n

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      Data Collection<\/span><\/p>\n

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        Source: Data for Britannia and NIFTY 50 was collected from the NSE website for the period 01-01-2024 to 31-12-2024.<\/span><\/p>\n<\/li>\n<\/ul>\n

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          Data Processing: Weekly closing prices were used to compute weekly returns:<\/span><\/p>\n<\/li>\n<\/ul>\n

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          \u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0NIFTY 50 weekly returns \u2192 X<\/span><\/p>\n

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          \u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0Britannia weekly returns \u2192 Y<\/span><\/p>\n

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            Regression Analysis: Britannia\u2019s returns (Y) were regressed on NIFTY 50 returns (X).<\/span><\/p>\n<\/li>\n<\/ul>\n

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            Data Analysis<\/span><\/p>\n

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            Regression Equation<\/span><\/p>\n

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            The regression model obtained is:<\/span><\/p>\n

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            Britannia Return = 0.015 + 0.58 NIFTY 50 Return<\/span><\/p>\n

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