BT500: Stars of the Bourses

India’s equity markets have been on a roll over the past year. New investors have been entering the market in droves, driven by the soaring indices and the hope that despite all the Covid-19 disruptions, the economy will be able to bounce back, leading to an improvement in corporate fortunes. Between October 1, 2020, and September 30, 2021, the S&P BSE Sensex gained 21,058 points, or 55.32 per cent, indicating the kind of up-move the markets have been witnessing. Business Today’s much-awaited annual compendium of India’s most valuable companies, the BT500 ranking, comes to you against this background. And the results are in line with the rally at the bourses—the aggregate rise in market wealth of the BT500 in 2021 has been to the tune of 43.4 per cent, as several firms across sectors saw sharp increases in their average market capitalisation, the measure we used to rank the companies during the period mentioned earlier. BT has been ranking companies based on market value since 1992, and this year we began with a master sample of 3,550 listed firms, eliminating those which weren’t traded for at least 20 per cent of the review period’s 248 trading days. The final ranking put together by Shivani Sharma of BT’s Research Bureau carries important pointers to how investors perceive these companies.

The top three—Reliance Industries (RIL), Tata Consultancy Services (TCS) and HDFC Bank—retain their ranks this year, too, while Infosys finishes fourth, followed by Hindustan Unilever. Importantly, Bajaj Finance (No. 9) and State Bank of India (No. 10) enter the top 10. Another important takeaway this year is that the BFSI sector contributed the largest chunk of the market capitalisation to the BT500, followed by the IT and oil and gas sectors. And here’s an interesting fact: the BT500 topper in 1992 was Tata Steel with a market capitalisation of `5,726 crore, while for 2021’s No. 1 RIL, the figure is `14.08 lakh crore, indicating how far India’s markets have travelled. There are other stories that have emerged from this year’s list. Anand Adhikari examines how, troubled by asset quality issues, mid-sized banks have taken a knock with those like Bandhan Bank, RBL Bank, Ujjivan Small Finance Bank and IndusInd Bank slipping in their rankings. While Dilasha Seth tracks the rising fortunes of the IT sector, Rahul Oberoi finds out why the Adani Group firms have seen a sharp surge in market value. And Arnab Dutta reports on how a reorganisation of businesses and smart strategic focus have seen Tata Consumer Products Ltd double its market value this year.

On the subject of markets, Ashish Rukhaiyar and Krishna Gopalan bring you the details of the growing trend of shareholder activism, and how investors and institutions have begun asserting themselves, forcing managements and boards—big and small—to often review their decisions. Thanks to sharper regulatory focus and new laws, shareholders are no longer content with being mute spectators at meetings and are ensuring that companies take their views into account. If done right, this can only be a welcome trend for Corporate India.