According to the study that was released on Wednesday, Reliance Industries, Indiabulls Ventures and IndusInd Bank are the biggest, fastest and most-consistent wealth creators, respectively.
Reliance Industries has emerged as the biggest wealth creator during 2014-19 by adding Rs 5.6 lakh crore of wealth, according to a study. The top-100 wealth creators generated Rs 49 lakh crore during 2014-19, the highest-ever quantum of wealth added, according to Motilal Oswal’s Annual Wealth Creation Study 2019. “After a gap of 7 years, Reliance Industries has once again emerged the biggest wealth creator over 2014-19. A total of Rs 5.6 lakh crore wealth created by Reliance is the highest-ever so far by a huge margin,” it added.
According to the study that was released on Wednesday, Reliance Industries, Indiabulls Ventures and IndusInd Bank are the biggest, fastest and most-consistent wealth creators, respectively. Indiabulls Ventures is the fastest wealth creator for the second time in a row, with stock returns at a whopping 78 per cent compound annual growth rate (CAGR).
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The study added that Bajaj Finance has the unique distinction of being in the top-10 biggest as well as fastest wealth creators. Also, IndusInd Bank is the most-consistent wealth creator by recording the highest CAGR of 49 per cent over the 10-year period of 2009-19. During 2014-19, Sensex’s CAGR was only 12 per cent but the pace of wealth creation was at 22 per cent CAGR.
“This reinforces the point that wealth creation happens in all kinds of market conditions,” it said.
The study by the financial services company further added that the financial sector has emerged as India’s biggest wealth-creating sector over 2014-19 for the third consecutive year. The surge in wealth creation in the sector has been led by private banks and non-banking financial companies (NBFCs).
Public sector undertakings’ (PSUs) wealth creation performance remained weak during 2014-19.
The number of PSUs in the top-100 wealth creators is only nine, namely IOC, BPCL, HPCL, Power Grid Corporation, Petronet LNG, Indraprastha Gas, LIC Housing, Bharat Electronics and NBCC. The total wealth destroyed during 2014-19 is Rs 8.6 lakh crore. Similar to last year’s study, the financial sector has the unusual distinction of being the biggest wealth creator thanks to private banks and NBFCs and also the second biggest wealth destroyer thanks to state-owned banks.
The Motilal Oswal’s Annual Wealth Creation Study 2019 analyses the top-100 wealth-creating companies. Wealth created is calculated as change in the market capitalisation of companies between 2014 and 2019, duly adjusted for corporate events such as mergers, de-mergers, fresh issuance of capital, and buyback, among others.