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RIL 2nd among world's largest value creators

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Press Trust of India Boston
Last Updated : Jan 21 2013 | 4:48 AM IST

Mukesh Ambani-led Reliance Industries has been ranked second in the list of world's 10 biggest 'sustainable value creators', companies that have been successful in creating the most shareholder value over the last decade, prepared by Boston Consulting Group.

The list compiled by the global management consulting firm names Brazil-based mining and materials giant Vale as the top value creator worldwide for the 2000-2009 period.

"One side effect of the Great Recession has been to accelerate the ascent of companies from rapidly developing economies to the top ranks of the world’s creators of shareholder value," BCG said in the report titled 'Threading the Needle: Value Creation in a Low-Growth Economy'.

The ranking identifies large global companies with a market capitalisation of at least $35 billion that have been the "most successful at sustaining superior value creation over 10 years."
    
BCG says a decade is the minimum time frame necessary to evaluate the staying power of a company's value creation performance.
    
The report has also listed companies industry-wise for creating the most value for their shareholders from 2005 to 2009. Starting from a database of more than 4,000 companies worldwide, the report presents detailed analyses of the Total Shareholder Return (TSR) at 712 companies across 14 major industries for the five-year period.
    
Of the top 142 companies included in this year’s global and industry rankings, 81 are located in developing economies. In a further indication of how emerging economies are pulling ahead of developed countries, the top 10 value creators in the 712-company sample are all from Asia- five companies listed on stock exchanges in China, two in Hong Kong, and one each in India, Indonesia, and South Korea.
    
Similarly, seven of the top ten large-cap value creators (those with market valuations of more than $35 billion) are listed on stock exchanges in rapidly developing economies of Brazil, Hong Kong, India, Mexico and South Korea.
    
"Most developing economies are rebounding relatively quickly to their precrisis growth levels. In contrast, developed economies are entering an extended period of below-average growth with profound implications for how companies create value and which companies come out on top," report co-author Daniel Stelter said.

Indian mining and materials giant Jindal Steel and Power occupies the number two spot in the BCG list of the 'Global Top 10' value creator companies for the 2005-2009 period.
    
Reliance Industries again comes second in the 'Large Cap firms' for 2005-2009 of 112 global companies with a market valuation of more than 35 billion dollars.
    
In industry-specific rankings, auto major Mahindra and Mahindra occupies the fourth spot among 38 automotive companies that created most value for shareholders in 2005-2009 period followed by Hero Honda Motors at sixth and Maruti Suzuki India at the seventh spot.
    
In the chemicals industry, Reliance Industries has been named the second biggest value creator of 53 global firms during the period behind South Korea's OCI.
    
In the consumer goods category, ITC ranks sixth among the top 10 companies, while Larsen and Toubro (sixth) and Bharat Heavy Electricals (seventh) are among the 77 companies that have created the most shareholder value in the machinery and construction segment.
    
Telecom company Bharti Airtel and Infosys Technologies occupy the seventh and ninth spot respectively in the Technology and Telecommunications category for the 2005-2009 period.

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First Published: Sep 09 2010 | 1:47 PM IST

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