What a difference a year can make. This time last year, when we were carrying out the BT 500 survey - our annual exercise to identify and gauge the performance of the biggest publicly listed companies in the country by market capitalisation, revenues, profits and other financial parameters - the equity markets were still in the doldrums. On September 30, 2013, the Sensex had closed at just under 20,000 - almost the same level that it was at on January 1, 2013. The average market capitalisation of the top 500 listed companies in the 2013 edition of the BT 500 had grown by a mere five per cent over the previous year. The revenue and profit growth had also been quite anaemic and there was a listless air around the whole corporate sector.
Since October last year though, the situation has changed quite dramatically. This year's exercise shows that the aggregate average market capitalisation of the top 500 companies as on September 30, 2014 was Rs 83,00,601 crore - or 36 per cent higher than the previous year. The market capitalisation of the number one company in the BT 500 - TCS - was up by 44 per cent from last year. In fact, barring the fast-moving consumer goods major ITC Ltd, every company in the top 10 grew their market capitalisation by 20 per cent or more over last year.
Since the new government has taken charge in May-end this year, the stock markets have been on fire and this shows up quite clearly in our BT 500 numbers this year. (There has been some dampening of sentiment in the stock markets in the last couple of weeks, but most analysts feel that this is temporary.)
The BT 500 survey throws up a wealth of data and trends for all those interested in overall corporate performance. This year's list is particularly interesting because of the divergent trends it shows. At one level, the market capitalisation of the BT 500 has been higher than ever before. Looking at only market capitalisation figures, one would think that the good times are back. Look at the revenue and profit figures, and it becomes clear that the improvement has been marginal. The topline - or revenue growth - of BT 500 this year has grown by a mere 9.7 per cent, while profit growth has been an even more dismal 3.6 per cent. On the other hand, as the market capitalisation figures show, the optimism about the future revenues and profit growth of these companies is at an all-time high.
While optimism has been rising, the BT 500 survey and reporting also show that there is a need to temper the enthusiasm a bit. As our main story points out, despite Prime Minister Narendra Modi's efforts to get manufacturing going, most factories in India still have to cross numerous hurdles every single day. From lack of power to bad roads, from labour problems to tangled tax laws - manufacturers in India face bigger problems than their counterparts in many of our neighbouring countries. While Modi and his government are serious about tackling these problems, the situation on the ground will easily take six months to a year to improve - if things go right.
The BT 500 survey is our flagship special issue in which the entire BT team gets involved. Niti Kiran and Jyotindra Dubey - senior research associates - did all the heavy lifting and the number crunching to identify the top companies according to various financial parameters. They practically lived in office for two weeks prior to the final listings. Deputy editor Alokesh Bhattacharyya, who is in charge of special issues, oversaw the effort. Once the lists were compiled, executive editor Suveen Sinha took over and coordinated the reporting effort. The editing desk, design department and photography department worked in tandem to bring out this bumper issue. The BT 500 is an enriching exercise for the entire edit team. I hope that you will find it as interesting to go through as we did in putting it together.