Text: | Print|

Oil giants, banks lead Fortune 500

2013-07-17 09:45 Global Times Web Editor: Wang YuXia

Fortune China magazine Tuesday released the 2013 Fortune China 500 list, the annual list ranking the Chinese mainland's largest listed companies in terms of revenue.

The total revenue of the 500 companies on the newly released list increased 10 percent from the previous year's list to 26.18 trillion yuan ($4.27 trillion). The total profits of all the companies on the 2013 list increased 3 percent year-on-year to 2.17 trillion yuan.

Companies need to have revenue of no less than 7.25 billion yuan to appear in the list, increased from last year's 6.21 billion yuan. This requirement was largely due to China's continuing economic growth, the magazine said.

The 2013 list is still led by China's two largest energy firms, Sinopec and PetroChina.

Sportswear company Li Ning and computer producer Founder Technology dropped out of the list because of intensified competition. 

This year's list saw a total of 47 companies suffering losses, more than double last year's 21, largely due to overcapacity and the economic slowdown.

The top four profitable companies on the list are the country's big four State-owned banks, led by the Industrial and Commercial Bank of China (ICBC).

On the list, high-end liquor producer Kweichow Moutai Group has the highest profit margin at 50 percent, despite a thrift campaign launched by the central authorities at the end of last year. It is followed by ICBC and the Bank of Nanjing as well as Internet firms Baidu Inc and NetEase. 

It is understandable that companies like Moutai, who have unique resources, and firms with technological innovations are capable of earning huge profits, Luo Yuding, a deputy dean of the College of Business at the Shanghai University of Finance and Economics, told the Global Times on Tuesday. 

However, it is unreasonable that China's financial sector earns huge profits because of monopolies caused by administrative control and restrictions on competition, Luo said.

Profits from the financial sector accounted for 50.2 percent of the total profits for the 2013 Fortune China 500 list, up from 41.3 percent in 2011 and 45.2 percent in 2012, the magazine said. In comparison, on the 2013 Fortune US 500 list, financial companies earned 23.7 percent of the total profits, increased from the previous year's 17.4 percent.

Luo said that commercial banks are unlikely to voluntarily support the real economy as they are in pursuit of the maximum profits possible.

"The government should relax control by allowing more private and foreign firms to enter the financial sector. Only with full competition can firms in the sector provide better services and can the real economy get much-needed financial support," Luo noted.

Fortune China said State-owned enterprises (SOEs) dominated the list, but did not give a detailed proportion. The top private company on the list is Ping An Insurance in 13th position, followed by the Lenovo Group at 21st.

China's economic slowdown can mainly be attributed to the SOEs which have the largest scales but the lowest efficiency, Tian Yun, editor-in-chief of the Macro China Information Network, told the Global Times, noting that many monopolies must be broken in order to tap growth potential.

A bigger number of companies are from traditional industries, with 59 from the metals sector and 46 from machinery manufacturing, while only three are from the Internet sector.

Tian said it would take about 10 to 20 years for information technology and mobile Internet companies to replace basic industries in dominating the list, which is a part of China's transition to a service-oriented economy.

Comments (0)
Most popular in 24h
  Archived Content
Media partners:

Copyright ©1999-2018 Chinanews.com. All rights reserved.
Reproduction in whole or in part without permission is prohibited.