Seven Indian firms, including Reliance Industries and Reliance Capital from the two Ambani groups, have been named among Asia Pacific’s 20 best companies in terms of expected investor returns over next five years. 

The list titled “Tomorrow’s Winners” prepared by global investment banking giant Morgan Stanley also includes telecom major Bharti Airtel, engineering & construction major Larsen & Toubro, Kishore Biyani-led Pantaloon Retail, infrastructure company IDFC and real estate firm Sobha Developers.

“Of the companies selected, more than half are listed in either China or India. Many of these are capitalising on major secular trends, such as infrastructure investment and per capita consumption growth,” Morgan Stanley said in a report.

“The rapid growth of Asian markets, India and China in particular, has led to an unparallelled focus on the region and its businesses,” it said, adding that these are the companies “that can build on their competitive edge over the long term and consistently deliver outstanding shareholder returns.”

According to the report, the companies chosen lead their domestic competitors and are strong enough to withstand competition from abroad. The majority operate in industries that have high barriers to entry.

The list was prepared after reviewing companies, their industries and respective competitive advantage. Besides seven Indian firms, there are six listed in Hong Kong, two each in China, Taiwan and Korea and one in Australia. 

Leading the way

About RIL, Morgan Stanley said that its consolidated net profit and asset base would more than double in 5 years. Reliance Capital was expected to become one of the largest players in non-banking financial services in India in the next 2-3 years. The report said that key growth drivers for Bharti Airtel include strong net additions, economies of scale, and the tower business de-merger. For L&T, it said that key drivers include strong growth in the core construction business.