Search
You're invited to try out the new version of Value Research Online. Click here to begin: https://beta.valueresearchonline.com

Companies that club industry profits

Here are companies that form a group to take out the entire industry's profits


  • TweetTweet
  • LinkedinLinkedin
  • FacebookShare
 

This is a category of the companies that form a group to take out the entire industry profits.

Take the mining sector. This is the domain of public-sector enterprises. Two companies, Coal India and NMDC, together take away 95 per cent of the industry's profits. Given Coal India's monopoly, it is not surprising that the company takes away 65 per cent of the sector's profits.

Subscribe to the Value Research Insight newsletter

There are really no comparable quality alternatives to Exide and Amara Raja when it comes to automotive batteries. These two together take away 90 per cent of the organised battery-market profits in the country.

There are also instances where three or four companies together take away the entire sector's profits.

In the ratings game, CRISIL, CARE and ICRA own the profits. In paints, Asian Paints, Kansai Nerolac and Berger together take away 90 per cent of the organised industry profits. In air conditioners, Voltas, Lloyd and Hitachi freeze 86 per cent of the organised-sector profits.

Of course, this study takes into account only listed companies that have public data available. Every industry has unlisted players, sometimes a significant player, like Honda in two-wheelers or Samsung or LG in domestic appliances. We have tried to make a note of such unlisted major private players wherever possible.

Phenomenally, the big four of IT industry - TCS, Infosys, Wipro and HCL Tech (excluding Cognizant) take away 84 per cent of listed company profits for the sector. This is from a list of 133 software companies under consideration.

In sanitaryware, the organised industry is dominated by three players, Kajaria, HSIL and Cera, with industry leader Kajaria cornering twice the profit share of its closest competitor.

The following table shows the main Club Profits companies.

CLUB PROFITS: Two or three companies take away the majority of industry profits

Industry/companyRevenue
(Rcr)
Revenue
share (%)
Net profit
(Rcr)
Net profit
share (%)
Abrasives3492268
Carborundum Universal205058.7113851.53
Grindwell Norton113532.5110438.84
Agriculture3097438
Kaveri Seed116137.4930168.62
Advanta140745.448619.56
Air Conditioners13411643
Voltas518338.6538660.05
Lloyd Electric & Engineering217316.28813.75
Hitachi Home & Life157311.737812.1
Automobiles: Passenger cars1212446383
Maruti Suzuki4929540.66379159.38
Mahindra & Mahindra7194959.34259340.62
Automobile598785587
Bajaj Auto2161436.1281250.33
Hero MotoCorp2730345.6234942.03
Batteries169011137
Exide Industries953556.4261654.18
Amara Raja Batteries421124.9241136.12
Bearings6081525
SKF India238139.1620539.05
FAG Bearings*166627.3916832.03
Ceramics / sanitaryware9558498
Kajaria Ceramics*222323.2519338.69
HSIL194220.328517.17
Cera Sanitaryware*8548.937014.01
Diesel engines105191150
Cummins India440641.8978668.33
Kirloskar Oil Engines250723.8314312.45
IT software31448758227
TCS*9820531.232019634.68
Infosys5331916.951237321.25
Wipro4695114.93871414.97
HCL Technologies3570911.35730612.55
Lubricants6990822
Castrol336248.0952163.37
Tide Water Oil103714.8415919.29
Mining & minerals9030020999
Coal India7201579.751372765.37
NMDC1234813.67640130.48
Oil exploration18805525302
ONGC15907584.591767369.85
Cairn India146467.79448017.7
Paints256082167
Asian Paints1502358.66142765.86
Kansai Nerolac Paints358714.0127512.7
Berger Paints India432216.8826512.21
Pesticides & agrochemicals271072452
UPL1209144.6116647.57
Bayer CropScience361513.3438315.62
PI Industries19377.1524610.03
Ratings1860460
CRISIL*127668.6126357.21
CARE*26314.1313128.53
ICRA32117.256614.26
Refineries136549336608
Reliance Industries37543527.492364064.58
BPCL24241917.75508213.88
IOC44831532.83487213.31
Shipping115711658
Great Eastern Shipping343829.7174845.13
Essar Ports165414.2939323.69
Shipping Corporation of India415435.920112.12
Travel services6532217
Thomas Cook273941.9310448.13
Cox & Kings255639.139041.69
*Financial data as of June 2015. Rest of the data as of March 2015.

It's time to start building your stock portfolio with great stocks at low valuations.


Our equity analyst team has sifted through hundreds of companies and selected a short list of stocks that you should invest in. This list now has 37 stocks on it. Thousands of our members are using stagnant equity markets to buy great stocks at low prices.


Membership is currently available at a 40% to 60% discount. Learn more and become a member

comments powered by Disqus