BT500: For India Inc the trend is long-term bullishness with short-term volatility

For some time now, the Indian markets have been navigating geopolitical concerns and global economic headwinds, and this has been reflected over the past few months in the way the equity markets have behaved. While most market analysts believe that the country is generally in a good place as far as its fundamentals are concerned and that the India story is on a secular uptrend, immediate concerns often turn the bourses jittery. The trend then is long-term bullishness with short-term volatility. Amid this choppiness, Indian bellwether companies have, by and large, fared well, and held their ground as far as market performance is concerned. The BT500, the much-awaited ranking of India’s most valuable companies—where we rank the Top 500 in terms of their average market capitalisation (m-cap)—reflects this. The period under consideration is October 2022 to September 2023. The combined average m-cap of the BT500 this year has grown, but by a muted 4 per cent. Compare this with the 26 per cent growth in the figure last year, and you get the picture.

This year’s BT500 list, helmed by Rahul Oberoi and Prince Tyagi of BT Research, has some interesting takeaways. While there’s very little change at the top of the list, one important development is the entry of ICICI Bank into the Top 5, dethroning IT bellwether Infosys from that position. Infy settles at No.6 this year. Reliance Industries (No.1), Tata Consultancy Services (No.2), HDFC Bank (No.3), and Hindustan Unilever (No.5) hold on to their positions of last year. State Bank of India’s healthy market showing sees it move up one rank to No.7. Bolstered by its performance at the bourses, ITC breaks into the Top 10, at No.8. Bharti Airtel moves up one rank to No.9, while Bajaj Finance also enters the Top 10 this year, moving up one rank from last year.

There are a couple of other themes that underline this year’s rankings. Most railways-related stocks showed smart increases in rankings riding on the government’s increased focus on railway infrastructure, while banks gained smartly. Punjab and Sind Bank, UCO Bank, and Punjab National Bank, among others, were the public sector banks that gained. And while last year the Adani pack were the stars of the bourses with massive upward momentum, this year has been a very different story, thanks to the Hindenburg Research report that accused the group of governance lapses and accounting fraud, charges that the group has stoutly denied. However, the impact of the report and its aftershocks were felt massively by Adani Group stocks, which took severe knocks for weeks before the group mounted a strong confidence-building and growth recalibration exercise. Despite these rescue efforts, barring Adani Enterprises, Adani Power and Ambuja Cements, all other Adani Group firms saw their rankings fall this year. The markets aren’t easy to please.