The Economic Times reported that the total value of Tata Group companies combined has exceeded the entire Gross Domestic Product (GDP) of Pakistan. This growth is attributed to strong stock market performance by various companies within the Tata conglomerate.
Tata Group’s Market Capitalisation Exceeds Pakistan’s GDP:
- The combined market capitalisation of Tata Group companies now stands at approximately $365 billion or over Rs 30 lakh crore. This surpasses Pakistan’s GDP, estimated by the IMF at around $341 billion.
- Notably, Tata Consultancy Services (TCS), a key player within the group, holds a market capitalisation of nearly Rs 15 lakh crore or $170 billion, which is half the size of Pakistan’s economy according to IMF estimates.
Contributing Factors to Tata Group’s Market Surge:
- Several Tata Group companies have witnessed significant increases in their stock values, with Tata Motors and Trent being notable examples.
- Tata Motors saw a surge of 110% in its share value, while Trent experienced a remarkable 200% increase.
- Additionally, other companies such as Tata Technologies, TRF, Beneras Hotels, Tata Investment Corporation, Tata Motors, Automobile Corporation of Goa, and Artson Engineering have contributed to the conglomerate’s overall market value.
Listed vs. Unlisted Companies within Tata Group:
- While the reported market value pertains to listed Tata Group companies, there are numerous unlisted entities within the conglomerate, including Tata Sons, Tata Capital, Tata Play, Tata Advanced Systems, and Air India.
- Considering the unlisted businesses, the total market capitalisation of Tata Group would significantly increase. For instance, Tata Capital alone commands a valuation of roughly Rs 2.7 lakh crore on the unlisted market.
Tata Group Structure and Management:
- The Tata Group is professionally managed and predominantly owned by philanthropic trusts, with no individual promoter having a significant stake. Ratan Tata, a prominent figure associated with the group, owns less than 1% stake in Tata Sons.
Pakistan’s Economic Challenges:
- Pakistan is facing severe economic difficulties, including high levels of debt, inflation, and external financial pressure.
- With external debt and liabilities amounting to $125 billion, Pakistan is under strain to secure funds for upcoming debt payments.
- The impending expiration of Pakistan’s $3 billion IMF program and dwindling foreign exchange reserves add to the country’s financial woes.
Comparison with India’s Economy:
- In contrast, India’s economy, valued at $3.7 trillion, is significantly larger than Pakistan’s, currently ranked as the fifth-largest in the world.
- India’s economic growth trajectory positions it to potentially become the third-largest economy globally by FY28.
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