ONGC, Tata top ISB list of expanding Indian MNCs

ONGC and diversified conglomerate Tata group have topped the list of Indian Multinational Enterprises (MNEs) prepared by the Indian School of Business (ISB) and Vale Colombia Center on Sustainable International Investment (VCC).  The 24 Indian companies which figured in this survey made an investment of $15.3 billion in 2006-07. 

The survey released by ISB and VCC at Columbia University in New York is part of a long-term study of the rapid global expansion of MNEs from emerging markets, particularly from the so-called BRIC countries: Brazil, Russia, India and China.  The survey establishes a baseline against which subsequent developments can be measured.

The report identifies 24 large multinationals and ranks them on the basis of their foreign assets. These 24 companies are among the largest outward investors from India and, in 2006, they jointly accounted for: These companies also have 60,000 employees, globaly and foregin sales of $12.7 billion. 

The leading company on the list of 24 was the public sector oil and natural gas giant  ONGC, which accounted for 31% of the foreign assets on the list. It was followed by the conglomerate Tata Group, accounting for a further 27%. The Tata Group – which includes Tata Steel, Tata Chemicals, Tata Consultancy Services (IT), Tata Motors and Tata Communications (telecoms), among other companies – had the largest number of employees abroad, just under 25,000.

Although the ranking by foreign assets draws on 2006 data, the report goes beyond it to provide information about large Indian investments in 2007 as well. The largest brownfield investment (i.e., investment through a merger or acquisition targeting an existing company) in 2007 was the Tata Steel acquisition of Corus Group (UK) for about $12.7 billion, while the largest greenfield investment was by GAIL, formerly the Gas Authority of India Ltd, which invested $4.2 billion in petrochemicals in Saudi Arabia. 

The foreign assets of India’s top MNEs could have doubled in 2007, given the large increases in outward investment in that year. Outward M&A deals alone surged to nearly $25 billion in 2007.