Boston Consulting Group (BCG) has added telecom major Bharti Airtel and drug-maker Lupin into its list 100 companies from the emerging markets which can challenge existing Fortune 500 firms over the next five years.
In a report titled ‘BCG Global Challengers 2011, released globally on Tuesday, it says, these 100 firms, mostly from China, India, Brazil, Mexico and Russia, and for the first time four companies from South Africa and Egypt, are “the ‘hidden engines’ of the global economy and can qualify for inclusion in the Fortune Global 500 in five years as they grow faster and more profitably than MNCs from developed world.”
This year, overall, there are 23 new challengers, including Bharti and Lupin, in the list from 16 countries. The BCG Global Challenger series was launched in 2006 to identify companies shaking up the global economy.
The 100 challenger companies grew annually by 18 per cent during 2000-09. If they continue on their current growth path, they could collectively generate $8 trillion in revenues by 2020, an amount roughly equivalent to what the S&P 500 companies generate today. These challengers’ revenue stood at $1.3 trillion in 2009, the report said.
“As competition intensifies, the boundaries between these two distinct sets of companies will continue to blur. Many challengers are creating disruptive business models and coming up with new and better ways to get the job done in many industries. Bharti Airtel exemplifies this approach with its innovations in outsourcing and distribution,” said BCG India Partner & Director and a co-author of the report Sharad Verma.
Of the 20 Indian firms in the list, six are from the Tata Group - TCS, Tata Steel, Tata Motors, Tata Global Beverages, Tata Communications and Tata Chemicals. Others are RIL, Infosys, L&T, M&M, Bajaj Auto, Wipro, Hindalco, Crompton Greaves, Dr. Reddy’s, Bharat Forge, Suzlon and Vedanta.