The Hindu Business Line : 32 BSE-500 companies join the billion-dollar club

Sweet dreams are made of these. In the last one-year, 32 new companies traded on the BSE-500 index have gained between 13 per cent and 1100 per cent in market capitalisation to enter the one-billion-dollar mark. This takes the total tally to exactly a 100 this year from 68 billion-dollar m-cap companies last year.

These 32 companies belong to diversified sectors of the Indian economy. Apart from the most favoured sectors such as capital goods, engineering, infrastructure, sugar, retail, auto, banking and metals, sectors such as pharma, FMCG, shipping, chemicals, and finance too seem to have caught the investors' fancy.

In a way, this also reflects the broad base of the current rally where sectors, which not too long ago were considered defensive, participated in creating investor wealth with gusto.

Notables from the not-so-favoured sectors include GE Shipping, SCI, Essar Oil, Aventis Pharma and Wockhardt where the gain in m-cap has been a modest 27-50 per cent compared to others in the list such as Dabur India, Colgate Palmolive, Indian Hotels and Jaiprakash Associates, where the m-cap has gained more than 120 per cent to name just a few.

Companies such as Videocon Industries, Financial Technologies, Bajaj Hindustan, Reliance Capital and Bharat Earth Movers, which were not even Rs 1,500 crore in market cap, have pushed their way into the billion-dollar market cap club.

To put things in perspective, the m-cap of the entire BSE-500 index pole-vaulted from Rs 15,79,802 crore as on March 31 last year to Rs 26,56,913 crore this march, a cool gain of 68 per cent in investors' wealth. At the same time, India's GDP, which was at Rs 23,93,671 crore at factor cost for 2004-2005 is estimated to grow to Rs 25,87,558 crore assuming an 8.1% GDP growth rate for 2005-06.

Considering the above figures the m-cap (BSE 500) to GDP ratio, too, has improved from 0.65 to 1.02 a clear indication of how the capital markets help galvanise the real economy. For this particular period an estimated 8.1 per cent growth in GDP has brought about a 68 per cent rise in investors' wealth in the financial markets.

For these 32 latest-entrants to this elite club, their m-cap has increased by 117.87 per cent from Rs 87,950 crore as on March 31, 2005 to Rs 1,91,618 crore as on March 31 this year.

For starters, Videocon Industries was the biggest gainer in the m-cap race with 1101.80 per cent gain from March 31, 2005 to March 31, 2006. The Rs 773.74-crore m-cap company in 2005 has touched a stratospheric Rs 9,298.84 crore in March this year.

Financial Technologies, which has promoted India's biggest commodity exchange, MCX, and is proposing to sell 3.6 million shares in MCX's forthcoming IPO, is the second biggest gainer with it's m-cap zooming up by 546.51% from Rs 1163.14 crore as on March 31, 2005 to Rs 7519.82 crore in March 2006.

The other 100 plus percentage gainers are: Bajaj Hindustan (404%), Reliance Capital (372%), BEML (312%), Pantaloon Retail (225%), Balrampur Chini (189.60%), Gammon India (176.59%), Indian Hotels (162.84%), Engineers India (161.49%), Jaiprakash Associates (151.50%), Crompton Greaves (142.16%), Colgate Palmolive (138%), Dabur India (123%), Cummins India (113%) and Kotak Mahindra Bank (105%).