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DATA ANALYSIS

Annexure (Table1, Graph 1)

From the quantative data in the table we can see that there was a steady
growth in the production of paint industry was steady till the year 2001 but it had a
remarkable fall in the year 2002 because of less import of raw material and the paint
industry took around 5 years to reach a point where it was in 2001. from 2005 the
industry is witnessing a steady growth in the production of paint. This shows that the
paint industry had witnessed a negative growth of around 10% in the year 2002 and
presently the growth rate in production is approximately 6%.

Annexure (Table2, Graph 2)

From the data we can analyze in the year 1999 the export of paint industry
was 2643.8 tonnes and went down in 2000 and then there was a constant rise in the
export from and we see that the export went up to 8909.2 tonnes witnessing a high
increase of 265.99 % in 2003 from a negative increase in export in 2002 and the
export again fell down in 2004 and from then there has been a steady increase in
export and the growth rate was approximately at 37.71% in 2008 which shows that
there is a lot of foreign exchange that is brought by the paint industry.

Annexure (Table 3, Graph 3)

Since paint industry is a raw material intensive industry there has been a
steady increase in the import of raw materials for paints but there was a dip in the
import in the year 2000-2001 which effected the production of 2002 directly. From
2002 onwards there has been a steady increase in the import and presently the import
is 32781.5 tonnes showing an outflow of cash of approximately Rs. 837 crores.
The Indian paint companies have a tie up with the foreign players thus the threat of
import of paint is not much of a problem but being a raw material extensive industry
there has been a high outflow in terms of import of raw materials.

Annexure (Table 4, Graph 4)

From the sales data we can conclude that the sales of the paint has been
growing remarkably and there has been no fall in the sale of the industry. Despite a
dip in the production in the year 2002 the sales was not hit and it continued to grow
and presently it is around Rs. 10750 crores. Thus, we see that sales is high showing a
high profitability of the industry and with a increasing disposable income of the
consumer it is expected to increase in the coming years.

Annexure (Table 5, Graph 5)

The market size of the paint industry has grown over the past ten years. The
growth was steady in the previous years but market size has increased remarkably
from 2005 showing an increase in the growth of market from 10.54% in 2003 to a
remarkable growth in 2007 of 19.88 but though the trend has been an increasing one
but the growth rate has reduced to 15.54% in 2009.
Annexure (Table 6, Graph 6)

The domestic consumption of paint has increased at a steady rate. Though


there has been an increase in the domestic consumption but the growth rate during the
year 2000 to 2003 has considerably fallen from 13.8% to 4.31% but from 2004 it
started to increase again owing to the fact that product awareness through
advertisements had increased, the product was no more taken just as a luxury product
and the income of the consumers had increased. In 2004 it showed a growth of
10.79% which increased 20.7% in 2007 but due to global economic recession it went
down to 16.1% an 2008 and further down to 15.6% in 2009.

Annexure (Table 7, Graph 7)

The data shows that sales are inversely related to rainfall. During the monsoon
season the sales of the paint industry goes down pertaining to the fact that due to
rainfall the paint cannot be used. In years with less rainfall the paint industry
witnesses higher sales as compared to the years with higher rainfall.

Hypothesis Testing of Regression 1


The influence of rainfall(x) on Sales of paint industry is given by the
regression equation
y= (14427.647) +(-9.002x).
The hypothesis tested with the regression equation is as follows:
H01: b= 0 (no influence of rainfall on sales of paint industry)
H11: b=/0 (influence of rainfall on sales of paint industry)
At 95% confidence level the R2 value is .092. This means that 95% of the influence
of rainfall on sales is explained. The p-value or significance is .221. This value is
more than 0.05. With this null hypothesis is accepted and alternate hypothesis is
rejected. The impact of rainfall on sales is inverse but statistically not significant.

Hypothesis Testing Of Regression 2


The influence of Sales(x2), Raw Materials (x3), Rent(x4), Advertising(x5),
Travelling(x6), Power(x7), Repairs(x8), Processing Charges(x9), Profit After Tax(x10) is
given by the regression equation
y= (438354.130) + (22.198x2) + (-5.984x3) + (6943.516x5) + (-42427.819x6) + (111.339x7) + (4.692x10)
The hypothesis tested with the regression equation is as follows:

H02: b= 0 (production of paint does not depend on sales of paint)


H12: b=/0 (production of paint depends on sales of paint)
At 95% confidence level the R2 value is .972. This means that 95% of the
influence of sales in production is explained. The p-value or significance is .939. This
value is more than 0.05. With this null hypothesis is accepted and alternate hypothesis
is rejected.

H03:b= 0 (production of paint does not depend on cost of raw material)


H13:b=/0 (production of paint depends on cost of raw materials)
At 95% confidence level the R2 value is .972. This means that 95% of the
influence of raw material in production is explained. The p-value or significance is .
985. This value is more than 0.05. With this null hypothesis is accepted and alternate
hypothesis is rejected.
H04: b= 0 (production of paint does not depend on rent paid for infrastructure in paint
industry)
H14: b=/0 (production of paint depends on rent paid for infrastructure in paint
industry)
The variable is removed variable as it has insufficient data to calculate the
regression.

H05: b= 0 (production of paint does not depend on advertisement cost incurred by the
paint industry)
H15: b=/0 (production of paint depends on advertisement cost incurred by the paint
industry)
At 95% confidence level the R2 value is .972. This means that 95% of the
influence of advertisement cost in production is explained. The p-value or
significance is .05. This value is equal to 0.05. This is the confidence with which null
hypothesis is rejected and alternative hypothesis is accepted. Thus this regression
equation proves that advertising cost influences the production of paint industry.

H06: b= 0 (production of paint does not depend on travelling expenses paid by the
paint industry)
H16: b=/0 (production of paint depends on travelling expenses paid by the paint
industry)
At 95% confidence level the R2 value is .972. This means that 95% of the
influence of travelling cost in production is explained. The p-value or significance is .
036. This value is less than 0.05. This is the confidence with which null hypothesis is
rejected and alternative hypothesis is accepted. Thus this regression equation proves
that travelling cost influences the production of paint industry.

H07: b= 0 (production of paint does not depend on power charges paid by the industry
for production)
H17: b=/0 (production of paint depends on power charges paid by the industry for
production)
At 95% confidence level the R2 value is .972. This means that 95% of the
influence of power charges in production is explained. The p-value or significance is .
888. This value is more than 0.05. With this null hypothesis is accepted and alternate
hypothesis is rejected.

H08: b= 0 (production of paint does not depend on repairs cost borne by paint
industry)
H18: b=/0 (production of paint depends on repairs cost borne by paint industry)
The independent variable repairs is removed due to insignificance of the data.

H09: b= 0 (production of paint does not depend on processing charges paid by the
industry production unit)
H19: b=/0 (production of paint depends on processing charges paid by the industry
production unit)
The independent variable is removed due to insignificance of the data.

H010:b=0 (production of paint does not depend on profit after tax of the industry)
H110:b=/0 (production of paint depends on profit after tax of the paint industry)
At 95% confidence level the R2 value is .972. This means that 95% of the
influence of Profit After Tax in production is explained. The p-value or significance is
.972. This value is more than 0.05. With this null hypothesis is accepted and alternate
hypothesis is rejected.

Hypothesis Testing of Regression 3


The influence of Advertisment Cost on Profit After Tax is given by regression
equation:
y= (-274.991) + (1.000x).
The hypothesis tested with the regression equation is as follows:

H011:b=0( Profit After Tax of paint industry does not depend on Advertisment Cost
incurred by the company)
H111:b=/0 (Profit After Tax of paint industry depends on Advertisment Cost incurred
by the company)

At 95% confidence level the R2 value is .824. This means that 95% of the
influence of Advertisment Cost on Profit After Tax is explained. The p-value or
significance is .000. This value is less than 0.05. This is the confidence with which
null hypothesis is rejected and alternative hypothesis is accepted. Thus this regression
equation proves that advertising cost influences the profit after tax of paint industry.