'GDP growth no longer a benchmark for firms'

McKinsey said top 20% listed firms outpaced GDP growth during 2012-22

- Nehal Chaliawala

The fastest-growing major Indian listed firms outpaced the country's overall economic growth, in revenue terms, by almost 1.5 times between 2012 and 2022, according to a recent study by global consultancy McKinsey & Co.

The study covered 837 listed companies, which posted revenues of more than ₹750 crore in FY22. The top quintile (one-fifth) of this set of companies reported a compound annual growth rate (CAGR) of 15% or higher in revenue, while India's nominal gross domestic product (GDP) growth rate averaged around 10%, McKinsey said.

Based on the findings, McKinsey analysts said companies need to set aggressive growth targets to outperform both peers and the economy. "The biggest top-level insight we got from the analysis is that it is no longer enough for a company to say that they will grow faster than the GDP," Jaidit Brar, senior partner at McKinsey & Co, said in an interview. "Companies must start with high aspiration and seek to grow 2-3 times faster than their industry."