ipl-logo

Reliance Company Case Study

2225 Words9 Pages

A STUDY ON THE HISTORICAL PRICE OF
RELIANCE CAPITAL LTD.

Submitted to JINDAL GLOBAL BUSINESS SCHOOL, O.P.JINDAL GLOBAL UNIVERSITY in partial fulfilment of the requirements for degree of MASTER OF BUSINESS ADMINISTRATION

BY

KIRTI SINGLA
JGU ID-20142022

INTRODUCTION
Reliance Capital Ltd. is a part of the Reliance Group. It is a constituent of CNX Nifty Junior and MSCI India. In the private sector, it is one of the leading financial services companies in India.
The business mix of the company is-
Asset management Mutual fund, Pension fund, Offshore fund, Portfolio management
Insurance Life Insurance, General Insurance
Commercial Finance Mortgages, Loans against property, SME Loans, Loans for vehicles, Loans for construction equipment, …show more content…

NIFTY-
The total risk associated with a particular stock constitutes-
• Unsystematic risk- Company specific risk that can be diversified.
• Systematic risk- Risk arising from macroeconomic factors, which cannot be diversified.
Beta (β) is the measure of systematic risk. It indicates the extent to which market volatility impacts the price of a stock. It is used to compare the volatility of various stocks.
Higher the Beta value, higher will be the responsiveness of security price to changes in market. If β>1, it shows the aggressiveness of the security.
The following is beta calculation for RCL. It was calculated by regression analysis as well as using the historical stock price. From Regression (Yearly) From Data Intercept βN= 0.30 0.24 βRCL= 2.74 2.19 -0.37

The β value for Reliance Capital Ltd. is found out to be 2.74. This shows that a 1% change in market return will be followed by a 2.74% change in the security return. As the beta here is greater than one, it shows that RCL is an aggressive stock and is market oriented. If the market index (NIFTY) increases or decreases, the stock will quickly respond to those movements. Hence the stock is suited for

Show More
Related

  • Roaring 20 Dbq Essay

    685 Words  | 3 Pages

    With the invention of credit, or the ability of a customer to obtain goods or services before payment, consumers could purchase goods beyond their financial means. The stock market also became a popular method of making money, as investors tested their luck on Wall Street and hoped to earn a profit from various business schemes. Document G is excerpted from Harry J. Carman and Harold O. Syrett’s 1952 book A History of the American People and discusses the process of buying a stock on margin, or borrowing money from a broker to purchase stock. According to Carman and Syrett, since the buyer only payed for part of the stock, there was a risk that their stock could lose value quickly. The broker may then be

    Read More

  • Massachusetts Stove Company Case Study

    1064 Words  | 5 Pages

    Thus, they are in a position to cover any debt obligations that may come up quickly. Their inventory turnover has been relatively steady over the five years of data. In year 7 their inventory turnover reached 3.2 which means inventory is moving through to customers at an increased rate over the year which correlates with their increased sales. This statement is supported by the fact that the days inventory held for stoves has dropped over the past five years from 146 days in year 3 to 114 days in year 7. These reductions have allowed for the reduction of their days in accounts payable from 51 all the way down to 11.

    Read More

  • Dollarama Company Case

    990 Words  | 4 Pages

    This is the measurement of the levels of investor confidence which influences the value of a firm in the

    Read More

  • Business Case Study: Jurlique International Pty Ltd.

    2179 Words  | 9 Pages

    INTRODUCTION:- Jurlique International Pty Ltd. is an Australian cosmetics manufacturer specializing in natural botanical-based skincare and cosmetics under the brand name Jurlique. Jurlique is considered ethical and environmentally friendly. Jurlique was founded in 1985 the Australian state of South Australia by Dr Jurgen Klein and his wife Ulrike. The company 's name is based on a phonetic combination of their first names.

    Read More

  • Calaveras Vineyard Case Study Solution

    1061 Words  | 5 Pages

    This was done with the help of a weighted average unlevered beta, the market risk premium and the risk free rate. The risk free rate of 5.85 % has been acquired from the 30 year T bond rates. The beta was found out using the three other comparable companies and their unleveraged betas. With help of all these values the discount rate of 10.847% was calculated which contributed in discounting the cash flows and obtaining the present value of cash flows. The continuing value for Calaveras has been estimated using the key value driver formula which was found out to be $ 7019.715.

    Read More

  • Comparison Of Nordstrom Vs Nordstroms

    1345 Words  | 6 Pages

    Conversely, Nordstrom has been able to produce value in the market, which is reflected in their high market-to-book ratio. Because of this, investors using these ratios will be more likely to seek equity in Nordstrom’s rather than

    Read More

  • Similarities And Differences Between The Single Index Model And Capital Asset Pricing Model

    1217 Words  | 5 Pages

    Outline the similarities and differences between the Single Index Model (SIM) and the Capital Asset Pricing Model (CAPM). Justify which of the two models makes a better assessment of return of a security (25 marks). To reduce a firm’s specific risk or residual risk a portfolio should have negative covariance or rather it should have no variance at all, for large portfolios however calculating variance requires greater and sophisticated computing power. As such, Index models greatly decrease the computations needed to calculate the optimum portfolio. The use of such Index models also eliminates illogical or rather absurd results.

    Read More

  • Catatech's Competitive Advantage

    1187 Words  | 5 Pages

    This reduced the company’s inventory costs by over 20% which improved delivery

    Read More

  • Porter's Five Forces For Bicycle Industry

    724 Words  | 3 Pages

    2.2 Industry Analysis - Porter’s 5 Forces Analysis Threat of Substitutes Bicycles and services from unknown manufacturers can provide huge substitution threats. Just as alarming for bicycle manufacturers is the internet: it is developing as an excellent medium for cheap marketing services. The price that consumer are willing to pay for a product is depends the quantity and the availability of substitute products. When a close substitute for a product is exist, industry profitability is suppressed because consumer will pick out if the price are high. Example consumer will compare the price of other bicycles with this bicycle in terms of quality and appearance, a customer can easily get another bicycle which is less difference but in more cheaper

    Read More

  • Marriott Corporation Case Study

    1050 Words  | 5 Pages

    Beta Unlevered (βU) = 0.97 / [1+ (1-0.44) (0.41/0.59)] = 0.6982 Calculating beta at the targeted leverage

    Read More

  • Sodium Thiosulfate And Hydrochloric Acid Lab Report

    3578 Words  | 15 Pages

    With this small change (by 51.4 seconds), it can be concluded that there is a relationship between the different temperatures of sodium solution and the time it takes for the ice cube to melt in the sodium solution. The raw data graph also has a c or the y intercept of 64.24 seconds and the R2 value is 0.97281. R2 value is a fraction between 0.0 and 1.0, and has no units. An R2 value of 0.0 means that knowing X does not help you predicts Y. There is no linear relationship between X and Y, and the best-fit line is a horizontal line going through the mean of all Y values.

    Read More

  • Advantages Of Risk Metrics

    919 Words  | 4 Pages

    Given the risk considerations provided in the RCD tool and the Portfolio Theory, the next step should be understanding the available risk/return metrics and determining an optimal mix of assets. Risk Metrics and Advantage/Disadvantages There are two risk metrics used in the model, Conditional Tail Expectation (CTE) and Value at Risk (VaR). These two metrics both look at the tail of the distribution. VaR is a measure of particularly poor outcomes in a stochastic projection. Its major shortcoming is its lack of statistical coherency.

    Read More

  • Case Study Of Mahindra

    3102 Words  | 13 Pages

    EXECUTIVE SUMMARY Mahindra and Mahindra, the business sector pioneer in multi-utility vehicles in Asian nation. The corporate began creating business vehicles in 1945. Mahindra is that the pioneer by a long shot in business vehicle furthermore the second biggest inside of the voyager vehicle market. The corporate is that the world 's 6th biggest medium and huge business vehicle creating. Mahindra is best celebrated for utility vehicles and tractors in Asian nation, Its car division, the organization 's most established unit (established in 1945), makes jeeps and three-wheelers (not explorer "auto rickshaws," however utilitarian conveyance and flatbed incarnations).

    Read More

  • Single Index Model And Capital Asset Pricing Model

    1129 Words  | 5 Pages

    Outline the similarities and differences between the Single Index Model (SIM) and the Capital Asset Pricing Model (CAPM). Justify which of the two models makes a better assessment of return of a security (25 marks). To reduce a firm’s specific risk or residual risk a portfolio should have negative covariance or rather it should have no variance at all, for large portfolios however calculating variance requires greater and sophisticated computing power. As such, Index models greatly decrease the computations needed to calculate the optimum portfolio. The use of such Index models also eliminates illogical or rather absurd results.

    Read More

  • Tata Communications Case Analysis

    930 Words  | 4 Pages

    1. INTRODUCTION Tata Communications is a truly global communications provider with operations, infrastructure and partnership across established and emerging markets.. Tata Communications focuses on serving key vertical segments, including banking & financial services and media & entertainment, as well as providing catalyst Tata Communications founded in 1986 by Indian Government, The TATA communication Headquarters is in Mumbai, Maharashtra. Mainly TCL key people is Vinod Kumar (CE & MD), the revenue US$2.6 billion (2011), operating Income US$182 million (2011)

    Read More

More about Reliance Company Case Study

Open Document