Grant Thornton launches first Indian Company Tracker

Tuesday, July 01, 2008 | Posted by: Grant Thornton
Categories: | Tags: India, LSE, tracker, India Watch, Anuj Chande

Performance of Indian companies on the London Stock Exchange since 1 January 2007*

Twenty per cent increase in Indian firms on LSE over next six months predicted.

Grant Thornton launches its first quarterly India Watch with news that the London Stock Exchange (LSE) listed Indian companies are now significantly outperforming both the FTSE 100 and AIM 100, while the number of Indian companies listed on the LSE looks set to jump by at least 20 per cent in the second half of 2008.

We are using the India Watch to monitor the UK/India business relationship through examining both cross border M&A trends between nations and tracking the performance of Indian companies on the London Stock Exchange since 1 January 2007.

The index reveals Indian companies listed on the LSE are now collectively outperforming both the FTSE 100 and the AIM 100 by a wide margin, with the India Index up 34 per cent since 1 January 2007, while the FTSE 100 is down 15 per cent and the AIM 100 is down 13 per cent.

Since Vedanta Resources PLC listed in December 2003, there has been a steady stream of Indian IPOs, with a total of 30 companies now listed on both the Main Market (five companies) and, primarily, the AIM market (25 companies).

In fact, India is vying to be both the most prolific and most successful nation on the LSE, and all indicators point to this soon becoming a reality. A sustained economic boom within the subcontinent and the many perceived benefits for Indian companies that come with a London listing are key drivers in this process.

Poor domestic markets, access to a greater and wider investor base, international focus, the prestige and the profile raising that come with a London listing are all factors driving the number of Indian companies to explore a London IPO.

Particularly strong performers over the last 12 months include energy companies on AIM, in particular KSK Power Ventur PLC, while Vedanta Resources and Hardy Oil & Gas are also making an impact on the Main Market.

Top performing companies over the last year

Sector analysis

The success of these companies is also a reflection of the success of oil & gas and mining stocks, which continue to lead on share price growth. Several further sectors also offer great promise including technology, support services, infrastructure development and media.

Real Estate and Media dominate the sectors of India Listing

New Floats

After our involvement, either as nomad or reporting accountant, in five successful Indian floats on the AIM market over the past two months, we as a firm are now set to welcome another six Indian companies to market, a sign that the current economic slow-down in the UK is not dissuading Indian business leaders from raising finance here in London.

These prospective listings come from a variety of sectors including media, technology and natural resources.

These companies, expected to raise between £10 and £250 million each, will take the present number of Indian companies with full London listings from 30 to 36, a jump of 20 per cent through our firm alone, with further interest expected to boost this number before the end of the calendar year. This despite the current economic and political uncertainty evident within India today.

This is extremely heartening for the Grant Thornton South Asia Group as we have been involved in promoting the commercial relationship between the UK and India since 1991, and have also provided our services to every major corporate listing by Indian companies on the LSE.

Along with the LSE, we continue to promote London listings within the subcontinent, using links provided by our sizeable member firm Grant Thornton India in persuading companies to explore London as an option, offering a welcome boost to the London financial services sector in what continues to be a challenging year.

Anuj Chande
Partner and Head of South Asia Group
Grant Thornton UK LLP