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ITC, Axis Bank and Lupin are among the India's top 10 most competitive companies, according to Japanese broking firm Nomura.
Identified developing a quantitative framework, these companies have delivered above-average business returns, which has driven their long-term share price performance, says the brokerage.
Nestle India, Asian Paints, Cummins India, Sun Pharma, Pidilite, Amara Raja, HDFC Bank are the other companies that feature in the list.
Nomura identified companies by analysing historical performance and and using a quantitative process on factors which drive competitiveness. It eliminated high-return companies which have regulatory largesse for instance monopolies decreed by law (GAIL and Concor), companies with access to below-market-price raw materials. The analysis also focused on management quality
The broking firm said although the companies in the most competitive list aren't cheap but their combined market cap has outperformed the market significantly in the past.
“Companies with competitive strengths are in a position to defend business returns and can, therefore, produce superior market returns over the longer term,” says Nomura in a report by Prabhat Awasthi, Nipun Prem and Sanjay Kadam.
