Top 10 Exporters in FY02 - Views on News from Equitymaster

Helping You Build Wealth With Honest Research
Since 1996. Try Now

  • MyStocks

MEMBER'S LOGINX

     
Login Failure
   
     
   
     
 
 
 
(Please do not use this option on a public machine)
 
     
 
 
 
  Sign Up | Forgot Password?  

Top 10 Exporters in FY02

May 9, 2003

With the opening up of the Indian economy in the early 1990's, not only did foreign majors start to look at India as a key consumer, but it also opened the world to India Inc. The government, on its part, provided subsidies so as to incentivise manufacturers to sell more in the international markets, but not without a cause. Exports meant companies would earn in foreign currencies, which would in turn help the government in increasing its foreign exchange reserves. We take a look at some of the top exporters in the country (only listed companies) and the trend in the last decade.

 Exports 
(Rs m)Mar-94Mar-02% net sales*
Reliance Industries 2,215 99,659 19%
Infosys Technologies 249 24,955 96%
Wipro 138 23,495 69%
Indian Oil Corporation 2,438 20,788 2%
Hindustan Lever 1,576 17,741 16%
Satyam Computer Services 75 16,016 93%
National Aluminium 10,619 12,354 54%
Larsen & Toubro 249 11,516 15%
Ranbaxy Laboratories 4,410 10,855 48%
Bharat Heavy Electricals 2,546 9,895 14%
Total of the above 24,516 247,273 13%
India's exports 826,740 1,544,450  
% of India's exports3%16% 
*pertains to March 2002

As per our study in FY02, though Reliance was the top exporter in the country (among listed companies), it was the software companies that especially drew our attention. The big 3 of software (again listed companies), i.e. Infosys, Wipro and Satyam, scored in terms of maximum contribution of exports to revenues. For all 3, exports as a % of revenues stood way above the others. This is not surprising considering the fact that Indian tech companies have emerged as one of the most cost competitive service providers in the world. Currently, the top rung Indian tech majors are servicing the Fortune 500s of the world. This is vindicated by the fact that India accounts for 2% of global software services spending in FY03 as compared to a miniscule share a decade ago. At present in FY03 the Indian software exports are pegged around Rs 475 bn, a 30% growth over the previous year.

Another significant contributor to the forex earnings of the country has been Ranbaxy Laboratories. Ranbaxy sells its products in over 70 countries and has manufacturing units in 7 countries. As a result of which around 58% of its revenues in FY03 come from exports, mainly in the US and European markets. On a CAGR basis, exports have grown at 12% (FY94-FY02). The probable reason for the company to leverage on the international markets is because it saw the opportunity of generics in the western markets and set up a sizeable presence across countries well in advance. That anticipation is now paying off for the company. Apart from Ranbaxy, Dr. Reddy's is the other domestic pharma company which has significant exports and makes its way in the top 20. In FY02, 61% of its revenues came through exports, while in FY94 it was a mere 2%.

Company NameCAGR net sales**CAGR exports**
Satyam Computer Services 97%95%
Wipro 39%90%
Infosys Technologies 75%78%
Larsen & Toubro 15%61%
Reliance Industries 37%61%
Hindustan Lever 23%35%
Indian Oil Corporation20%31%
Bharat Heavy Electricals 9%18%
Ranbaxy Laboratories 17%12%
National Aluminium 8%2%
Total of the above22%33%
**growth over March 1994

Apart from manufacturing companies like National Aluminium, Larsen & Toubro and BHEL which are among the top foreign currency earners for the country, Indian Oil is also among this top 10 list. Although India has traditionally been an importer of oil and petroleum products, Indian Oil has been exporting petroluem products like diesel and Jet Fuel to Sri Lanka and Bangladesh as it has excess capacity in India. However, the export contribution to net sales in FY02 was only 2% and over FY94 it has grown only 1%. Reliance exports polymer products like Polypropylene woven fabrics and related products to the US and European markets and its exports have been growing at a CAGR of 61% (FY94-FY02).

Looking at the export statistics, it becomes clear that only the company's with innovation and vision have succeeded in exploiting the export potential. Both pharma and software have been the key achievers of this decade. One is now slowly seeing indian auto ancillary and engineering companies too making a mark on the global scene. Some big MNCs have made their Indian arms global sourcing bases. However, India's contribution to the international trade is just 0.6% and is expected to reach only 1% by 2007. Developed countries have traditionally been a target for Indian exports, but with the economic slowdown in the developed countries, India should look for emerging economies like China for potential growth. The government has also taken initiatives to give a fillip to the export oriented companies, but India Inc. still has a long way to go.


Equitymaster requests your view! Post a comment on "Top 10 Exporters in FY02". Click here!

  

More Views on News

Data is the New Oil but It's Also the New Sugar. Here's How to Fight it (Profit Hunter)

Jun 1, 2020

Is too much data hurting your quest for market beating returns?

Quantum Mutual Fund: Hum woh nahi hain (The Honest Truth)

Apr 29, 2020

Ajit Dayal on how the mutual fund industry robs you of your wealth.

This One Trigger Could Turnaround Yes Bank's Stock Price (The 5 Minute Wrapup)

Oct 16, 2019

If Yes Bank manages to do this, it could be the start of a much-needed turnaround for the bank.

Gold could Hit 40,000 Sooner Than Expected (Profit Hunter)

Aug 16, 2019

Domestic gold prices are firing on both engines now. Gold prices could touch 40,000 faster than you could imagine.

3 Rebirth of India Opportunities Are Racing Ahead in These Gloomy Times... (Views On News)

Jun 28, 2019

Tanushree Banerjee shares an update on the Rebirth of India and reveals her top 3 trends...

More Views on News

Most Popular

Why We Picked This Small-cap Stock for Our Hidden Treasure Subscribers (Profit Hunter)

Sep 17, 2020

This leading household brand will profit big time in a post covid world.

My Top Stock to Buy in this Market Selloff (Profit Hunter)

Sep 22, 2020

The recent correction offers a great opportunity to buy this high conviction smallcap stock.

Can the Nifty Fall to 10,200? (Fast Profits Daily)

Sep 24, 2020

The Nifty has reached an important support level today. If it breaks then we could see further downside.

What Do the Charts Say About Buying Smallcaps Now? (Fast Profits Daily)

Sep 18, 2020

Everyone seems to be excited about buying smallcaps now...but is it the right thing to do? What do the charts tell us? Find out in this video...

More

Covid-19 Proof
Multibagger Stocks

Covid19 Proof Multibaggers
Get this special report, authored by Equitymaster's top analysts now!
We will never sell or rent your email id.
Please read our Terms

COMPARE COMPANY

MARKET STATS