Wipro Is Fastest Wealth Creator For 5 Years: Study

Mumbai, January 13: | Updated: Jan 14 2003, 05:30am hrs
Wipro Ltd has emerged as the fastest and the biggest wealth creator during the period between April 1997-March 2002, according to Inquire Indian equity research, a subsidiary of brokerage firm, Motilal Oswal Securities.

As per the study conducted by Inquire, Wipros market capitalisation (M-cap) jumped by a whopping 133 per cent in terms of compounded annual growth rate (CAGR) over the last five years, while in terms of wealth creation, the software major has appreciated 68 times in the last five years. In terms of CAGR return, Satyam Computers stood second with a return of 122 per cent, followed by e-Serve at 110 per cent.

For study purpose, Inquire has identified those companies which have the distinction of having added at least Rs 100 crore to their M-cap after adjusting for dilution during the period from 1997-2002. The study shows that only 85 companies qualify for MOSt-Inquire 85, Wealth Creators.

The wealth creator group MOSt-Inquire 85 has outperformed the 30-share BSE Sensex with a huge margin. In the last five years, the CAGR, in the Sensex, has gained by a modest 0.64 per cent while the wealth creators Index has appreciated at a CAGR of 46.4 per cent

Stocks from the information technology (IT), fast moving consumer goods (FMCG) and pharmaceuticals top the group. From the list of 85 companies, over half is represented from these three sectors.

From the IT sector, there are 16 companies, FMCG 11 and Pharma 17 companies. The study reveals that homegrown IT and pharma companies have displaced multinationals (MNCs) as a major wealth creating class. In the last five years to March 2002, only 16 companies out of the total 85 companies were MNCs as compared to 19 out of the total 71 companies (fulfiling the criteria) which were MNCS in the five year period to March 2001. The big chunk of MNC representation was in the period from 1993-98. Out of the eligible 100 companies, 50 were MNCs.