{"id":23541,"date":"2025-12-30T18:08:53","date_gmt":"2025-12-30T12:38:53","guid":{"rendered":"http:\/\/www.sachdevajk.in\/?p=23541"},"modified":"2025-12-30T18:08:53","modified_gmt":"2025-12-30T12:38:53","slug":"relationship-between-hdfc-bank-ltd-and-nifty-50","status":"publish","type":"post","link":"http:\/\/www.sachdevajk.in\/?p=23541","title":{"rendered":"Relationship between HDFC Bank Ltd and Nifty 50"},"content":{"rendered":"

TOPIC : Relationship between HDFC Bank Ltd and Nifty 50<\/span><\/p>\n

Author: Harsh Shejwal<\/span><\/p>\n

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

HDFC Bank Ltd is one of India\u2019s leading private sector banks, providing a wide range of financial services including retail banking, wholesale banking, and treasury operations. Being a large-cap stock and a key constituent of the Nifty 50 index, HDFC Bank\u2019s stock performance is closely linked to overall market movements. Studying the relationship between HDFC Bank Ltd and the Nifty 50 helps in understanding the stock\u2019s market sensitivity and systematic risk.<\/span><\/p>\n

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

– To calculate the beta of HDFC Bank Ltd<\/span><\/p>\n

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– To observe the significance of beta with respect to Nifty 50 returns<\/span><\/p>\n

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

– Sharpe, W. F. (1964). Capital asset prices: A theory of market equilibrium under conditions of risk. Journal of Finance, 19(3), 425\u2013442.<\/span><\/p>\n

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– Fama, E. F., & French, K. R. (2004). The capital asset pricing model: Theory and evidence. Journal of Economic Perspectives, 18(3), 25\u201346.<\/span><\/p>\n

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

Data for HDFC Bank Ltd and the Nifty 50 index were collected from the official website of the National Stock Exchange of India (NSE) for the period from 1st December 2024 to 30th November 2025. Daily price data was downloaded and Friday closing prices were identified using the weekday function in Excel. Weekly returns were calculated using percentage change in closing prices. Weekly returns of the Nifty 50 were considered as the independent variable (X), and weekly returns of HDFC Bank Ltd were considered as the dependent variable (Y). Regression analysis was performed by regressing Y on X.<\/span><\/p>\n

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

Y = 0.215 + 1.12X<\/span><\/p>\n

N = 47, R\u00b2 = 0.62, F = 74.36, p-value = 0.000<\/span><\/p>\n

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The above equation shows the relationship between the weekly returns of HDFC Bank Ltd and the weekly returns of the Nifty 50 index. The beta value of 1.12 indicates a strong positive relationship between the stock returns and market returns. This implies that if the Nifty 50 return increases by 1 unit, the weekly return of HDFC Bank Ltd increases by approximately 1.12 units, showing that the stock is more volatile than the market.<\/span><\/p>\n

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The p-value of 0.000 is less than 0.05, indicating that the beta coefficient is statistically significant at the 5% level of significance. The number of observations (N = 47) represents the total number of weekly trading observations considered in the study.<\/span><\/p>\n

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The R\u00b2 value of 0.62 indicates that 62% of the variation in the weekly returns of HDFC Bank Ltd is explained by movements in the Nifty 50 index, while the remaining 38% variation is due to firm-specific and other external factors. The F-statistic value of 74.36 with a p-value less than 0.05 indicates that the overall regression model is statistically significant.<\/span><\/p>\n

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

The beta value of HDFC Bank Ltd is greater than one, indicating that the stock is more sensitive to market movements compared to the Nifty 50. This makes HDFC Bank an aggressive stock, suitable for investors with a higher risk appetite. The statistically significant relationship confirms that market movements play a crucial role in determining the returns of HDFC Bank Ltd.<\/span><\/p>\n

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

– National Stock Exchange of India. (2025). Historical market data.<\/span><\/p>\n

– Sharpe, W. F. (1964).<\/span><\/p>\n

– Fama, E. F., & French, K. R. (2004).<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"

TOPIC : Relationship between HDFC Bank Ltd and Nifty 50 Author: Harsh Shejwal \u00a0 Introduction : HDFC Bank Ltd is one of India\u2019s leading private sector banks, providing a wide range of financial services including retail banking, wholesale banking, and treasury operations. Being a large-cap stock and a key constituent of the Nifty 50 index,… Continue reading Relationship between HDFC Bank Ltd and Nifty 50<\/span><\/a><\/p>\n","protected":false},"author":140067,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-23541","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\/23541","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\/140067"}],"replies":[{"embeddable":true,"href":"http:\/\/www.sachdevajk.in\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=23541"}],"version-history":[{"count":1,"href":"http:\/\/www.sachdevajk.in\/index.php?rest_route=\/wp\/v2\/posts\/23541\/revisions"}],"predecessor-version":[{"id":23542,"href":"http:\/\/www.sachdevajk.in\/index.php?rest_route=\/wp\/v2\/posts\/23541\/revisions\/23542"}],"wp:attachment":[{"href":"http:\/\/www.sachdevajk.in\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=23541"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/www.sachdevajk.in\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=23541"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/www.sachdevajk.in\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=23541"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}