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BW Businessworld

How We Did It

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The universe of companies considered for the BW Real 500 ranking comprised 20,393 companies — including listed (on the National Stock Exchange, or NSE) and unlisted companies — whose annual audited financial data were available with Ace Equity Corporate Database as on 8 October 2011.

From this set, companies with total income plus total assets less than Rs 100 crore were eliminated, which left us with approximately 2,000 companies.

Consolidated numbers (combining numbers of subsidiaries and associates) were taken for companies that published them. All subsidiaries were eliminated from the BW Real 500 rankings to avoid double counting.

Standalone results have been taken for companies that have no subsidiaries, and for companies whose consolidated data were not available with Ace Equity. That left us with a base of around 1,400 companies.

Rankings are based on data for the financial year 2010-11. For companies whose fiscal ends in months other than March, fiscal-ending between September 2010 and August 2011 were considered. For companies whose fiscal year comprised more or less than 12 months, data has been annualised to 12 months.

For all stock market-related data and computations, NSE data was taken.

To eliminate differences in nature of manufacturing and finance companies (manufacturing firms are asset-heavy, while finance firms are income-heavy), two lists have been created for non-financial companies and financial service companies.

The main BW Real 500 rankings are based on the sum of total income and total assets. The ranking on individual parameters is taken on the entire base of 1,405 companies and not just the Top 500 companies.

The data was computed using the following definitions:

Total income: Net sales + other income 
Total assets: Includes net block, lease adjustment account, capital work in progress, pre- operative expenses pending, assets in transit, investments, total current assets, miscellaneous expenses not written off and net deferred tax. It  excludes total current liabilities.
Operating profit: Total income — total expenditure.
Profit after tax (PAT): As reported by the company in the annual report.
Reserves: Accumulated surplus of the company, including general reserves, capital reserves, share premium, etc.
Adjusted earning per share (EPS): Adjusted against split, bonus issue and rights issue.
Return on capital employed (ROCE): (Profit before tax + interest) / average capital employed for a two-year period.
Return on net worth (RONW): Profit after tax / average net worth for a two-year period.
Return on assets (ROA): Profit after tax / average of total assets for a two-year period.
Average market cap period: The average market capitalisation of all trading days between 1 April 2010 and 30 September 2011.
Total debt: Secured and unsecured borrowings.
Interest expenses: Interest expenses from the profit-loss account, which includes interest on term loan, interest on debentures or bonds, interest on fixed deposits, bank charges, etc.
Depreciation: Depreciation from the profit-and-loss account as reported by the company.
Profit after tax (PAT) margin: Profit after tax / gross sales multiplied by 100
Operating profit margin: Operating profit / gross sales multiplied by 100

## Figures for 12 months ended October 2010
# Figures for 12 months ended September 2010
* Figures for the 12 months ended December 2010
** Figures for 12 months ended June 2011
[s] Standalone numbers
(c) Consolidated numbers

(This story was published in Businessworld Issue Dated 24-10-2011)

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