Fortune 500 India: Top firms fuel India’s export engine

INDIA’S TOP CAR maker Maruti Suzuki India (MSIL) reported highest-ever exports of 2,83,067 units in FY24. This was significant for multiple reasons. First, it came at a time of slowing global demand for passenger vehicles (PVs). Second, the 9.15% rise more than made up for the 3.9% dip in PV exports by the rest of the industry, helping India’s overall PV exports rise 2%. MSIL, India’s top PV exporter for the third consecutive year, plans to scale up manufacturing from 2.25 million units per year in FY24 to four million by FY31. A big chunk will be exported. “We have 42% share of car exports. The target for this year (FY25) is 3,00,000 cars,” says chairman R.C. Bhargava.

MSIL is an example of how India’s leading companies — both in manufacturing and services — have pushed the country’s exports amid challenges such as slowdown in global demand, geo-political shocks, supply-chain disruptions and pandemic lockdown over the last decade. If India’s exports grew at a compounded annual growth rate (CAGR) of 3.34% from FY14 to FY24, a large part of the credit goes to BSE 500 or Fortune 500 companies. For instance, Maruti Suzuki’s export earnings grew at a CAGR of 16.13%, from ₹4,142 crore in FY14 to ₹18,475 crore in FY24. BSE 500 companies exported goods and services worth ₹14,54,131 crore in FY24. This was 40% of ₹36,18,952 crore total exports. The major contributors were 391 companies that have been part of BSE 500 over the decade; their combined export CAGR of 6.61% was close to double the growth in total exports.

Though most growth came from IT services companies and non-petroleum product makers, in terms of value, petroleum companies had the most heft. Reliance Industries earned the most from exports in FY24 (₹2,88,572 crore) and FY14 (₹2,61,366 crore), though its 10-year CAGR was just 1%. The next three, all IT services firms, reported high CAGR. Tata Consultancy Services (TCS) grew export revenues at 11.99%, Infosys at 11.29% and Wipro at 6.9% CAGR.

A glance at top 25 foreign exchange earners in FY24 shows about half are either IT or petroleum companies (seven IT, five oil). Others include four pharmaceutical, four steel, metal & mining, two automobile, one gas distribution, one aviation service and one tobacco company. HCL Tech (14.72%), LTI Mindtree (22.11), Vedanta (13.63%), Sun Pharmaceuticals (19.94%), GAIL India (52.21%) and Interglobe Aviation (27.03%) stand out in CAGR. Broadly, the three sectors that have taken India’s exports forward in the last decade are IT services, pharmaceuticals and engineering (automobiles). The traditional drivers, petroleum and gems & jewellery, have taken a back seat, at least in value growth.

Can top exporters sustain this growth? Or will new stars emerge? Let’s take a closer look at India’s top IT firms, which plan to continue focusing on global markets. “Firms enabling digital transformation, such as Infosys, will be in the eye of the storm. Software development will be rapidly automated. We have to seize productivity benefits and share them with customers. Gains from automation must lead to talent redeployment in areas with new opportunities. We must learn from applying artificial intelligence (AI) to ourselves, be it in creating an AI-first enterprise or accelerating the massive talent amplification that’s now needed,” says Nandan M. Nilekani, chairman, Infosys. “We are already doing it by applying Infosys Topaz (an AI-first offering to accelerate value creation for global enterprises using generative AI) to transform all our services,” he adds.

TCS is another example of IT companies embracing latest technologies to serve their diverse and global client base. In FY24, it consolidated its AI and Cloud expertise with AI.Cloud. All its business groups are developing domain-specific AI/GenAI offerings relevant to the industry value chain. The company has skilled over 3,00,000 employees in GenAI technologies and is enhancing its products and services with AI capabilities. “Globally, multiple mega trends are shaping the priorities of businesses: AI, new energy, supply chain and talent. These transitions will require substantial investments in technology. TCS is building capabilities to partner with customers during this phase of rapid technological shifts,” says TCS chairman N. Chandrasekaran.

IT firms are not an exception. Leading pharmaceutical companies that have been big exporters are also revisiting priorities to sustain growth. The objective is to move up the value chain and improve profitability by introducing niche and specialty products within the country but, more importantly, outside India. Sun Pharmaceuticals, which grew exports at 19.94% CAGR in the 10-year period, is enhancing capabilities in the global specialty business. Its current specialty portfolio has 26 innovative medicines in dermatology, ophthalmology and onco-derm segments. “Our focus has been to improve in-house clinical development capabilities for which we are building a clinical organisation, globalising our specialty assets beyond the U.S. and deepening business development capabilities,” says chairman and managing director Dilip Shanghvi. “We spent $148 million on specialty R&D in FY24 vs $65 million in FY20. This accounted for 78% of the total rise in R&D during the period. Our increased R&D guidance for FY25 indicates our intent to advance existing projects and enrich the specialty pipeline in our core therapy areas,” he adds.

Zydus Lifesciences is also pushing exports. The company, which reported a 10-year export CAGR of 15.1%, is betting on biosimilars — drugs and therapeutics similar to innovative biotech products — to power exports in the medium term. “By 2030, a large part of what we want to do should be from a technologically differentiated portfolio. Biologics will play that critical role,” says managing director Sharvil P. Patel. The company sells 300-plus molecules in the U.S. and has sought approvals for many more products in its second biggest market after India. “We will launch complex generics, difficult-to-do generics and volume generating generics in the U.S. We also have an interest in building a paediatric rare disease portfolio. Our own molecule, Saroglitazar, has completed recruiting for Phase-III in the U.S. for an orphan indication for PBC (primary biliary cholangitis). Another drug, Usnoflast, has completed Phase-II clinical trials for ALS (amyotrophic lateral sclerosis, a nervous system disease that affects nerve cells in brain and spinal cord). We want to build an innovative specialty business in the U.S,” says Patel. Zydus also plans to export to Mexico, Russia and some South Asian countries.

That’s not all. The list of top exporters has companies capable of driving exports in emerging sectors, too. For instance, Interglobe Aviation, which runs IndiGo Airlines, wants to increase revenue from international operations. Its export earnings touched ₹10,349 crore in FY24 by growing at a CAGR of 27.03% between FY14 and FY24. In June 2023, IndiGo placed the largest-ever single aircraft order by an airline (500 aircraft). It is expected to have 600-plus aircraft by 2030. “We have been strongly focused on internationalisation and are leveraging our strong presence in the domestic market to expand in international skies. At the end of the financial year, we had presence in 33 international destinations, seven more than the year before,” says CEO Pieter Elbers. “Internationalisation is picking up. The international capacity (ASK or available seat kilometres) will head towards 30% in the coming years,” he adds.

Overall, services exports, be it IT or aviation, seem to have an edge over goods exports. This is not out of sync with what India’s chief economic advisor observed in Economic Survey 2023-24: “The services sector witnessed a real growth rate of more than 6% in all the years in the last decade except pandemic-affected FY21. India’s services exports constituted 4.4% of the world’s commercial services exports in 2022.” India’s services exports accounted for 44% exports in FY24. The companies driving those exports will thus continue to play a major role in India’s export growth in future too.

Once production-linked incentive schemes take off, India will also see a resurgence in goods manufacturing. Calibrated efforts to make India an automobile hub have succeeded, and many more companies manufacturing mobile phones, medicines, medical devices, toys and electronics may make India gain further heft in international markets.