MUMBAI: The top 100 companies or wealth creators added a whopping Rs 148 trillion during the past five years (2020-25), which is the highest in past 30 years, and at an annual growth of 38%, sharply outperforming the Sensex’s 21% annual return during this period.
And Bharti Airtel leads the chart of wealth creators, adding Rs 7.9 trillion in wealth created, followed by ICICI Bank and SBI, while BSE is the fastest wealth creator with a 124% total return annually and the public sector Hindustan Aeronautics is the most consistent wealth creator delivering a 75% total return apart from also emerging as the best all-round wealth creator, reflecting strength across scale, consistency and speed, Motilal Oswal said in its annul wealth creation study released Thursday.
Commenting on the study, Raamdeo Agrawal, chairman of Motilal Oswal Financial Services said, the country is entering its most powerful compounding era. As the economy moves from $4 trillion towards $16 trillion by 2047, a combination of rising financialization, expanding equity ownership and stronger corporate profitability is creating a multi-trillion-dollar (MTD) opportunity for investors.
Long-term wealth will be created by high-quality businesses that can compound for decades. The key is to select your compounders carefully and avoid the temptation to time the market, he added.
The study measures wealth creation as the change in market capitalization over the past five years, adjusted for mergers, demergers, buybacks, capital issuance and dividends.
Wealth creation during 2020–25 is the highest in the 30-years study, with the top 100 companies adding Rs 148 trillion, driven by the sharp rebound from the Covid lows, he said.
Financials remain the largest wealth creating sector, followed by industrials, capital markets, technology and utilities while PSUs extend their comeback, especially in defence, energy and utilities.
Global financial assets are compounding steadily and market cap compounding at 17% over the last 20 years. India is now the fourth largest equity market globally with close to Rs 500 trillion in market cap.
While GDP quadrupled from $1 trillion to $4 trillion in the last 17 years; the study projects another quadrupling in the next 17 years, driving a multi-trillion dollar opportunity across sectors and taking it $16 trillion by 2047.