As the financial year 2018-19 draws to a close for the stock markets, the biggest gainer among the Indian 'fabulous five' so far is Mukesh Ambani's Reliance Industries (RIL), followed by Tata Consultancy Services (TCS), HDFC Bank and Hindustan Unilever (HUL). RIL's share price jumped around 50 per cent and market valuation went up by Rs 2.8 lakh crore. The petroleum giant tops the chart of market capitalisation (m-cap) with a valuation of Rs 8.5 lakh crore.
The rise of RIL is mainly because of exponential earnings growth of petrochemical business, surge in the subscriber number of Reliance Jio and expansion of Reliance Retail. RIL has made Rs 3 lakh crore investment to build Jio, which made a profit of Rs 723 crore in the first year of its operation (2017/18) on a revenue of Rs 20,154 crore. In the first nine months of this financial year, it made a profit of Rs 2,124 core. The rise of petrochemical margin has offset the sharp fall refining margin of the company. The segment earnings before interest and tax (EBIT) of petrochemical business grew by 64 per cent in the nine months until December 2018. The retail business has added about 2,500 stores in this period. The market cap (m-cap) shot up 144 per cent since January 2017.
TCS, which was topper for a long time in the chart, is around Rs 90,000 crore behind RIL now at around Rs 7.6 lakh crore. However, the market value graph of software powerhouse has surged by 43 per cent or gained around Rs 2.3 lakh crore of value in this financial year. The m-cap increased 72 per cent from January 2017. The income of the company has grown by 19 per cent to Rs 1.1 lakh crore in the nine months of 2018/19 and the profit went up by 23.5 per cent to Rs 23,410 crore. The company has registered higher incremental revenue addition than its rivals like Infosys and Wipro. The employee attrition of around 11 per cent also implies that the software maker has managed to be the most successful among its peers in retaining employees.
India's most valued lender HDFC Bank crossed the Rs 6 lakh crore-market capitalisation mark just a couple of days back, becoming the third company to do so after RIL and TCS. The share price of the bank rose by 19.5 per cent to Rs 6.15 lakh crore in this financial year, gaining around Rs 1 lakh crore so far. The bank's total deposits as of December 2018 stood at Rs 8.53 lakh crore, an increase of 22 per cent compared to a year back. For the nine months ended December quarter, the bank earned a total income of Rs 85,393.5 crore, up by 22.14 per cent. The profit went up by 19.7 per cent to Rs 15,193 crore. The capital adequacy ratio was at 17.3 per cent. The bank has 5,000 branches by mid-February. Since January 2017, the bank's m-cap has grown 87 per cent.
HUL and ITC, which are on the fourth and fifth positions, respectively, have been locked in a valuation war for some time and the global FMCG giant has overtaken the Indian behemoth in this financial year. HUL's M-Cap has increased by over 27 per cent (or Rs 80,000 crore) to Rs 3.7 lakh crore in this financial year. But ITC has been able to grow 14 per cent (or Rs 45,000 crore) to around Rs 3.6 lakh crore. HUL has more than doubled its valuation (106 per cent) since January 2017, but ITC has grown just 20 per cent.
The other biggies just behind the top five are HDFC Ltd (Rs 3.36 lakh crore m-cap, up 8 per cent in this financial year) and Infosys (Rs 3.09 lakh crore, up 27 per cent).