INTRODUCTION
\u00a0 \u00a0 Ambuja Cements Limited is one of India\u2019s leading cement manufacturing companies.
\u00a0 \u00a0 Established in 1983, it has a strong presence across the Indian construction industry.
\u00a0 \u00a0 The company is known for producing high-quality, durable cement for infrastructure and housing projects.
\u00a0 \u00a0 Ambuja emphasizes sustainability and eco-friendly practices, including low carbon footprint initiatives.
\u00a0 \u00a0 It operates multiple manufacturing plants and a wide distribution network across India.
\u00a0 \u00a0 Ambuja Cements is a part of the Adani Group, supporting India\u2019s infrastructure growth.<\/p>\n
\u00a0 \u00a0 OBJECTIVE
\u00a0 \u00a0 To calculate \u03b2 of Ambuja Cements Limited and observe its significance.<\/p>\n
\u00a0 \u00a0 DATA COLLECTION
\u00a0 \u00a0 Historical data of Ambuja Cements Limited and NIFTY50 index data (downloaded from NSE website for the period 01-Dec-24 to 30-Nov-2025).
\u00a0 \u00a0 The data was manipulated to get Friday closing prices.<\/p>\n
\u00a0 \u00a0 LITERATURE REVIEW
Fama and French (1992) argued that beta alone is often insufficient to explain stock returns. Their research showed that beta may not always be statistically significant, especially in short-term datasets or volatile markets. The Excel results show a very high p-value and low t-stat, indicating that the beta coefficient is statistically insignificant. This aligns with prior literature that questions the reliability of beta as a sole predictor of stock performance.<\/p>\n
\u00a0 \u00a0 DATA ANALYSIS<\/p>\n
\u00a0 \u00a0 Regression Equation:
y=0.1942+0.7770x
\u2022 Where:
\u00a0 \u00a0 y = Weekly Return of the stock
\u00a0 \u00a0 x = Weekly Return of NIFTY
This equation indicates a moderate positive relationship between NIFTY returns and the stock\u2019s weekly returns. A 1-unit increase in NIFTY\u2019s weekly return leads to an average 0.777 increase in the stock\u2019s weekly return.<\/p>\n
\u00a0 \u00a0 Number of Observations:
\u00a0 \u00a0 48 weekly observations<\/p>\n
\u00a0 \u00a0 Beta (\u03b2) Interpretation:
\u00a0 \u00a0 \u03b2 (slope coefficient) = 0.7770
\u00a0 \u00a0 This shows the stock is positively sensitive to market movements.
\u00a0 \u00a0 Since \u03b2 < 1, the stock is less volatile than the market.<\/p>\n
\u00a0 \u00a0 t-statistic for \u03b2:
\u00a0 \u00a0 t-stat = 3.3182
This value is sufficiently large, indicating that the beta coefficient is statistically meaningful.<\/p>\n
\u00a0 \u00a0 p-value:
\u00a0 \u00a0 p-value = 0.00178
Since p-value < 0.05 (and even < 0.01), \u03b2 is statistically significant.
This provides strong evidence that NIFTY\u2019s returns significantly explain the stock\u2019s returns.<\/p>\n
\u00a0 \u00a0 R\u00b2 (Coefficient of Determination):
\u00a0 \u00a0 R\u00b2 = 0.1931
This means approximately 19.31% of the variation in the stock\u2019s weekly returns is explained by movements in NIFTY.
The remaining 80.69% variation is due to other firm-specific or macroeconomic factors not included in the model.<\/p>\n
\u00a0 \u00a0 Adjusted R\u00b2:
\u00a0 \u00a0 Adjusted R\u00b2 = 0.1756
After adjusting for degrees of freedom, the explanatory power remains reasonably close, confirming model reliability.<\/p>\n
\u00a0 \u00a0 F-statistic and Model Significance:
\u00a0 \u00a0 F = 11.01
\u00a0 \u00a0 Significance F = 0.00178
Since Significance F < 0.05, the overall regression model is statistically significant, indicating that the independent variable (NIFTY returns) jointly explains the dependent variable.<\/p>\n
\u00a0 \u00a0 Intercept Interpretation:
\u00a0 \u00a0 Intercept = 0.1942
\u00a0 \u00a0 p-value = 0.6583
The intercept is not statistically significant, implying that when NIFTY returns are zero, the stock\u2019s return is not meaningfully different from zero.<\/p>\n
\u00a0 \u00a0 CONCLUSION
Here \u03b2 = 0.776341\u00a0
Since \u03b2 < 1, the stock is less volatile than the market, making it more suitable for defensive or long-term investment, as it tends to move less aggressively than NIFTY during market fluctuations.<\/p>\n
\u00a0 \u00a0 REFERENCES
Sharpe, W. F. (1964). Capital asset prices: A theory of market equilibrium under conditions of risk. Journal of Finance, 19(3), 425\u2013442. https:\/\/doi.org\/10.1111\/j.1540-6261.1964.tb02865.x
Fama, E. F., & French, K. R. (1992). The cross-section of expected stock returns. Journal of Finance, 47(2), 427\u2013465. https:\/\/doi.org\/10.1111\/j.1540-6261.1992.tb04398.x
Roll, R. (1977). A critique of the asset pricing theory\u2019s tests: Part I. Journal of Financial Economics, 4(2), 129\u2013176. https:\/\/doi.org\/10.1016\/0304-405X(77)90009-7<\/p>\n","protected":false},"excerpt":{"rendered":"
INTRODUCTION\u00a0 \u00a0 Ambuja Cements Limited is one of India\u2019s leading cement manufacturing companies.\u00a0 \u00a0 Established in 1983, it has a strong presence across the Indian construction industry.\u00a0 \u00a0 The company is known for producing high-quality, durable cement for infrastructure and housing projects.\u00a0 \u00a0 Ambuja emphasizes sustainability and eco-friendly practices, including low carbon footprint initiatives.\u00a0 \u00a0… Continue reading Relationship of Nifty with Ambuja Cements Limited<\/span><\/a><\/p>\n","protected":false},"author":139902,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-23037","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\/23037","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\/139902"}],"replies":[{"embeddable":true,"href":"http:\/\/www.sachdevajk.in\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=23037"}],"version-history":[{"count":1,"href":"http:\/\/www.sachdevajk.in\/index.php?rest_route=\/wp\/v2\/posts\/23037\/revisions"}],"predecessor-version":[{"id":23038,"href":"http:\/\/www.sachdevajk.in\/index.php?rest_route=\/wp\/v2\/posts\/23037\/revisions\/23038"}],"wp:attachment":[{"href":"http:\/\/www.sachdevajk.in\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=23037"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/www.sachdevajk.in\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=23037"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/www.sachdevajk.in\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=23037"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}