“Today, HUL has 39% value market share. The auto industry is not as fragmented as the FMCG sector because the barriers to entry in the FMCG business are relatively much lower. That means you have to be continuously on guard, even as you consolidate your position,” says Mehta, who is now the executive chairman of L Catterton India, a consumer-focussed joint investment venture between LVMH and Mehta.
At ₹62,911 crore in revenues and ₹10,277 crore in profits, it’s the only FMCG major in the Top 10; that’s a commendable position to be in despite rising competition. Sriprakash Sridharan, former director of Nielsen, a market analytics firm, and now the founder of Prajna Consulting, a boutique marketing and strategy consulting firm, says: “With India becoming digital, the ways of doing business have also evolved and changed. We now see national players and regional players dominating in the food space more than the MNCs. Home-grown players such as Nykaa, Tira, Forest Essentials, and Kama are making some dent in the premium and masstige personal care space which was once considered MNCs’ forte.”
Mehta, though, is quick to point out that despite all the news flow around the upstarts cornering incremental market share, HUL numbers are what still matters. “In my last year (FY23), HUL added ₹8,000 crore to its delta turnover, which was more than the total revenue of all the players that we’re talking about. So, many times, the optics are very different from reality because, in newspapers, a lot of space is given to companies doing ₹300-500 crore turnovers. But all that, put together, is not going to be dramatically different,” explains Mehta.
During his decade-long stint, HUL not only drove exponential financial growth but also redefined industry benchmarks for profitability, market share, and market capitalisation. “During my 10 years, we added ₹35,000 crore to HUL’s top line,” Mehta recalls.
“It was ₹25,000 crore before I came in. We took margins from 14% to 24% and market capitalisation from ₹1.2 lakh crore to ₹6.2 lakh crore,” says Mehta, who is close to wrapping up a book on leadership based on his tenure across Unilever geographies. The reference to ₹35,000 crore is significant, considering that it eclipses the total turnover of HUL’s next biggest competitor Nestlé, which ranks at 36 with a total income of ₹25,370 crore. While Wilmar International is hot on the heels of HUL at 11th position, its product portfolio is not as diverse. (More details on page 120).
While HUL and Maruti have a pre-liberalisation history, others in the Top 10 club, barring Nayara Energy (formerly Essar Oil), are the poster-boys of post-1991 reforms. Hyundai and Samsung from South Korea; Walmart and Apple from the US; BBK Electronics from China; and global consulting giant Accenture represent a diverse array of industries and geographies. Yet, their commonality lies in the opportunities unlocked by India’s post-liberalisation economic frame-work and the growing affluence of the middle class fuelled by rising credit. These firms exemplify a modern India that is both a lucrative market and a strategic hub for global operations.
“India’s population and the growing middle class is definitely a catchy point for any MNC to enter into the market. With India being one of the fastest-growing emerging markets and among the Top 5 GDPs in the world, the interest level is always there… Even if you win in certain states in India, the opportunity size is as big as a country,” says Sridharan.
Walmart, a brick-and-mortar retail behemoth in the US, has made its mark in the online retail landscape following the $16-billion acquisition of Flipkart in 2018. “Earlier there were a lot of hindrances in winning in the Indian market, especially if the market was a big traditional trade market, and you needed to have the distribution might to win. With e-commerce and quick commerce gaining traction along with growing modern trade, the distribution game has changed completely,” explains Sridharan, also the author of Building Blocks, a book on leadership.
While tech consulting firms such as Accenture have leveraged India’s burgeoning talent pool, Apple, once considered a premium niche brand, has expanded its footprint dramatical-ly, buoyed by local assembly operations and a young, aspirational consumer demographic. Similarly, in the mass premium category, BBK Electronics—the parent company of smartphone brands such as Oppo, vivo, OnePlus, and Realme—has captured the pulse of India’s tech-savvy youth (More details on page 110).
These companies—which collectively account for more than a fourth (₹85,316 crore) of the cumulative MNC 500 revenue—not only define the upper echelons of the Fortune India MNC 500 but also embody the rise of peak consumerism.
The late bloomers
Interestingly, the capital goods and industrial engineering sectors, which cumulatively account for ₹2.91 lakh crore of the MNC universe, has found a fresh whiff of life post 2014 on the back of higher government spending even as traditional industrial conglomerates are taking a fancy to consumer-oriented businesses after the pandemic. Not surprising that the likes of GE and Hitachi which have been in the country since the colonial era, are making the most of the new-found momentum in the Indian economy. Well-established corporations such as Siemens, Hitachi, GE, Cummins, Schneider, ABB, Alstom SA, and Honeywell dominate the capital goods pack with total income of ₹2 lakh crore and a market cap of ₹5.78 lakh crore.
Source:https://www.fortuneindia.com/long-reads/mnc-500-who-are-the-top-global-giants-driving-indias-438-billion-multinational-economy-heres-the-full-list/120823