{"id":12164,"date":"2024-08-19T22:01:15","date_gmt":"2024-08-19T16:31:15","guid":{"rendered":"https:\/\/gtm360.com\/blog\/?p=12164"},"modified":"2024-08-19T22:01:15","modified_gmt":"2024-08-19T16:31:15","slug":"when-will-ma-propel-an-indian-it-company-into-fortune-global-500","status":"publish","type":"post","link":"https:\/\/gtm360.com\/blog\/2024\/08\/19\/when-will-ma-propel-an-indian-it-company-into-fortune-global-500\/","title":{"rendered":"When Will M&A Propel An Indian IT Company Into Fortune Global 500?"},"content":{"rendered":"

\"\"<\/a>This has been a year of big ticket M&A in the Indian IT industry. While the acquisitions haven’t put any Indian IT company on the FORTUNE GLOBAL 500 list yet, for the first time since I started writing this annual post around a decade ago, I’m convinced that M&A will propel the Indian IT industry into this august list sooner rather than later.<\/p>\n

Before I do a deep dive on that subject, here’s a quick overview of the list of 500 largest global corporations published by FORTUNE magazine earlier this month.<\/p>\n

FORTUNE GLOBAL 500<\/strong><\/p>\n

The top 500 corporations in the world posted record-breaking aggregate revenues of $41 trillion, which represents more than one-third of global GDP.<\/p>\n

The mean Fortune Global 500 corporation has a revenue of $82 billion.<\/p>\n

Walmart<\/strong> remains #1 on the list for the 11th consecutive year. The 500th company on the list is Samsung C&T<\/strong>. Together, the two companies bring up the contours of Fortune Global 500:<\/p>\n

\"\"<\/a><\/p>\n

Amazon<\/em> reaches a new high and claims the #2 spot (up from #4 last year).<\/p>\n

Saudi Aramco<\/em> falls to #4; however, with $121B in profits, it is the most profitable company on the list for the third year in a row.<\/p>\n

\"\"<\/a>Despite negligible year-on-year revenue growth (0.1%), the Global 500 companies had their second-most profitable year ever, minting $2.97T in profits – Saudi Aramco (#4) being the most profitable with #7 Apple<\/em> coming in second.<\/p>\n

Five sectors – Financials<\/em>, Energy<\/em>, Motor Vehicles and Parts<\/em>, Technology<\/em>, and Healthcare<\/em> – account for 60% of the companies on the Global 500 and contributed 65% of the total revenue.<\/p>\n

After a gap of six years (2018), USA’s presence (139 companies) on the Fortune Global 500 surpassed that of Greater China (133 companies).<\/p>\n

INDIA IN FORTUNE GLOBAL 500<\/strong><\/p>\n

India has nine Fortune Global 500 companies, the largest being Reliance Industries<\/em> (#86) and the smallest being Rajesh Exports<\/em> (#463), with revenue of close to $109B and $34B respectively.<\/p>\n

\"\"<\/a><\/p>\n

This is one more than the count last year. HDFC Bank<\/em> is the new entrant, with a sharp growth of 93.4% in revenue resulting largely from the merger of the mortgage arm with the bank during the year.<\/p>\n

Five<\/em> of the companies on the list have posted decline in revenue this year (against none<\/em> in 2023). It’s a real decline in the case of four of them (Indian Oil<\/a><\/em>, Oil & Natural Gas<\/a><\/em>, Bharat Petroleum<\/a><\/em>, Rajesh Exports<\/a>) and a notional decline due to depreciation of INR against USD in the case of one (Reliance Industries<\/a>).<\/p>\n

FORTUNE GLOBAL 500 QUALIFYING REVENUE<\/strong><\/p>\n

The Fortune Global 500 Qualifying Revenue<\/em><\/strong> rose by 3.74%<\/strong> to $32.078B<\/strong>.<\/p>\n

\"\"<\/a><\/p>\n

For the uninitiated, Fortune Global 500 Qualifying Revenue<\/em> is the revenue hurdle that a company must cross to enter the hallowed corridors of the 500 largest corporations in the world. In other words, it\u2019s the revenue of the company ranked 500th on the list. FG500-QR has grown YoY every year in the last decade except in the lists published in 2016 and 2021.<\/p>\n

INDIAN IT INDUSTRY<\/strong><\/p>\n

The Indian IT industry continues to be driven by services rather than product companies. As I’ve said repeatedly over the years, that’s not a bad thing.<\/p>\n

\n

Product and Services businesses have different characteristics. Success in one does not assure success in the other. As a doyen of the Indian IT industry said, “Tell Nadella to Create a TCS”.
\nThis is equally true in FMCG industry.
\nHUL. Marico. pic.twitter.com\/D7xFxgf5Kg<\/a><\/p>\n

\u2014 Ketharaman Swaminathan (@s_ketharaman) August 8, 2024<\/a><\/p><\/blockquote>\n