Over the past decades, Motilal Oswal Financial Services, or MOFS, has been coming out with their annual Wealth Creation report. In December, they came out with their 24th Wealth Creation Study.
Here are some takeaways from the report.
Wealth creation is the process by which a company enhances the market value of the capital entrusted to it by its shareholders. It is a basic measure of success for any commercial venture. For listed companies, MOFS defines wealth created as the difference in market capitalization over a period of last five years, after adjusting for equity dilution.
Over the past 5 years (2014-19)
- Financials was India’s biggest wealth creating sector for the third consecutive year
- IT was the biggest loser
- Oil & Gas was the biggest gainer
- Wealth Creation was highly concentrated – top 5 sectors accounted for 85% of total wealth created
- The number of PSUs in the top 100 Wealth Creators was only 9 (IOC, BPCL, HPCL, Power Grid Corporation, Petronet LNG, Indraprastha Gas, LIC Housing, Bharat Electronics, NBCC)
