{"id":22951,"date":"2025-03-31T12:56:16","date_gmt":"2025-03-31T07:26:16","guid":{"rendered":"https:\/\/www.sachdevajk.in\/?p=22951"},"modified":"2025-03-31T12:56:16","modified_gmt":"2025-03-31T07:26:16","slug":"relationship-of-punjab-national-bank-pnb-with-nifty-50","status":"publish","type":"post","link":"http:\/\/www.sachdevajk.in\/?p=22951","title":{"rendered":"Relationship of Punjab National Bank (PNB) with Nifty 50."},"content":{"rendered":"
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Relationship of Punjab National <\/span>Bank<\/span> (<\/span>PNB) <\/span>with Nifty 50.<\/span><\/span>\u00a0<\/span><\/p>\n<\/div>\n

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Author: Prajwal Deshmukh<\/span>\u00a0<\/span><\/p>\n<\/div>\n

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\u00a0<\/span><\/p>\n<\/div>\n

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Introduction:<\/span>\u00a0<\/span><\/p>\n<\/div>\n

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Punjab National Bank is India’s first Swadeshi Bank. PNB is a Banking and Financial service bank owned by the Government of India with its headquarters is in New Delhi, India. It is the Second largest PSU after SBI.<\/span> The bank is\u00a0among the top <\/span>3 \u00a0Public<\/span> Sector Banks in India\u00a0by way of business size, with a strong presence in North and Central India.<\/span><\/span>\u00a0<\/span> \u00a0<\/span><\/p>\n<\/div>\n

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Objective:<\/span>\u00a0<\/span><\/p>\n<\/div>\n

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To find out the beta of PNB <\/span>and its<\/span> significance.<\/span><\/span>\u00a0<\/span><\/p>\n<\/div>\n

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Literature Review:<\/span>\u00a0<\/span><\/p>\n<\/div>\n

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Performance Comparison of Banks<\/span>\u00a0<\/span><\/p>\n<\/div>\n

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1)Dash and Mihir<\/span> (2009) states that private and foreign banks outperformed public sector banks in most CAMELS factors, primarily due to stronger management soundness and profitability. To <\/span>remain<\/span> competitive, <\/span>public sector<\/span> banks must enhance credit policies, customer service, IT adoption, and employee productivity. However, the study has limitations, including a small sample size, a restricted study period, and the CAMELS framework\u2019s narrow focus. Future research should incorporate <\/span>additional<\/span> risk factors for a more comprehensive evaluation of banking performance.<\/span><\/span>\u00a0<\/span><\/p>\n<\/div>\n

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2)<\/span>K.Ratna<\/span> (2014) sates that the post-liberalization era has brought both growth and challenges to the Indian banking sector, driven by globalization, technological advancements, and increasing competition. To <\/span>remain<\/span> competitive, banks must focus on cost efficiency, product differentiation, and continuous technological upgrades. Meeting evolving customer expectations, such as internet and mobile banking, is essential. By embracing innovation and refining strategies, Indian banks can successfully navigate these challenges and enhance their market position.<\/span><\/span>\u00a0<\/span><\/p>\n<\/div>\n

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Data <\/span>Collection<\/span>:<\/span><\/span>\u00a0<\/span><\/p>\n<\/div>\n

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PNB and Nifty50 data was downloaded from NSE site for the period 01-01-2024<\/span> to 31-12-2024<\/span> and data was manipulated to find out the Friday closing prices. Weekly returns were calculated, Weekly returns of Nifty<\/span> 50 is X and weekly returns of PNB is Y. Y was regressed on X.<\/span><\/span>\u00a0<\/span><\/p>\n<\/div>\n

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\u00a0<\/span><\/p>\n<\/div>\n

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Data Analysis:<\/span>\u00a0<\/span><\/p>\n<\/div>\n

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The equation is Equity = -0.068 + 1.352 Nifty 50<\/span>\u00a0<\/span>
<\/span>(3.193)<\/span>\u00a0<\/span><\/p>\n<\/div>\n

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Number of observations (N) = 47, f = 10.194, r\u00b2 = 0.185<\/span>\u00a0<\/span>
<\/span>The interpretation of the equation:<\/span>\u00a0<\/span>
<\/span>The above equation shows the relationship between Nifty 50 and Equity. Equity is a dependent variable and Nifty 50 is an independent variable. Positive sign means there is direct relationship between equity and Nifty 50 meaning if Nifty 50 rises, equity rises and if Nifty 50 falls, equity falls. If Nifty 50 rises by 1 rupee, equity will rise by 1.352 units. Figure in bracket () is t-stat and the p value for this is 0.00257 which is less than 0.05 meaning Nifty 50 is statistically significant at 5% level. Number of observations are 47, r\u00b2 = 0.185 which means 18.5% of equity is explained by Nifty 50, balance 81.5% is the error model. f= 10.194 and the p value or the significance value is 0.00257 which is less than 0.05 which means overall the model is statistically significant at 5% level.<\/span>\u00a0<\/span><\/p>\n<\/div>\n

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\u00a0<\/span><\/p>\n<\/div>\n

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Conclusion:<\/span>\u00a0<\/span><\/p>\n<\/div>\n

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The beta value is 1.352, which is greater than 1, meaning it is more volatile than the market and may not be ideal for long-term investment.<\/span>\u00a0<\/span><\/p>\n<\/div>\n

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References:<\/span>\u00a0<\/span><\/p>\n<\/div>\n

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Dash, Mihir, and Annyesha Das. “A CAMELS analysis of the Indian banking industry.”\u00a0<\/span>Available at SSRN 1666900<\/span>\u00a0(2009).<\/span>\u00a0<\/span><\/p>\n<\/div>\n

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Manikyam, K. Ratna. “Indian banking sector\u2013challenges and opportunities.”\u00a0<\/span>IOSR Journal of Business and Management<\/span>\u00a016.2 (2014): 52-61<\/span>.<\/span><\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

Relationship of Punjab National Bank (PNB) with Nifty 50.\u00a0 Author: Prajwal Deshmukh\u00a0 \u00a0 Introduction:\u00a0 Punjab National Bank is India’s first Swadeshi Bank. PNB is a Banking and Financial service bank owned by the Government of India with its headquarters is in New Delhi, India. It is the Second largest PSU after SBI. The bank is\u00a0among… Continue reading Relationship of Punjab National Bank (PNB) with Nifty 50.<\/span><\/a><\/p>\n","protected":false},"author":139825,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-22951","post","type-post","status-publish","format-standard","hentry","category-uncategorized","entry"],"_links":{"self":[{"href":"http:\/\/www.sachdevajk.in\/index.php?rest_route=\/wp\/v2\/posts\/22951","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\/139825"}],"replies":[{"embeddable":true,"href":"http:\/\/www.sachdevajk.in\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=22951"}],"version-history":[{"count":1,"href":"http:\/\/www.sachdevajk.in\/index.php?rest_route=\/wp\/v2\/posts\/22951\/revisions"}],"predecessor-version":[{"id":22952,"href":"http:\/\/www.sachdevajk.in\/index.php?rest_route=\/wp\/v2\/posts\/22951\/revisions\/22952"}],"wp:attachment":[{"href":"http:\/\/www.sachdevajk.in\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=22951"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/www.sachdevajk.in\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=22951"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/www.sachdevajk.in\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=22951"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}