Times of India, India
April 1 2007

India loses out to Armenia in number of super-growth companies
[ 1 Apr, 2007 1022hrs ISTPTI ]

NEW DELHI: With domestic firms announcing new M&A deals every other
day, showing a huge appetite for growth backed by a robust economic
expansion, India has surprisingly lost its place as the world’s
second largest home to "super growth" companies to a relatively
unknown Armenia.

While the US has retained its top position on Grant Thornton
International’s Super Growth Index for third year in a row, India
suffered a dramatic drop to 14th position as the country’s proportion
of super growth companies halved from 34 per cent to 15 per cent.

India has been replaced by a newcomer Armenia at the second position
with 38 per cent proportion of super growth companies there, as
against 44 per cent in the US, said the study, released on Sunday, by
global consultancy major Grant Thornton.

There was a huge 56 per cent plunge in the number of super growth
companies in India. These are the companies with significant
above-average growth in areas like turnover and employment, it said.

The other top five countries in the league include Ireland (third),
the UK (fourth) and South Africa (fifth), all of which have improved
their rankings.

Other major climbers on the index include Russia, Philippines,
Argentina and Italy.

However, Hong Kong — another strong performer in 2006 at third
place, has also dropped out of the top ten list to 11th position this
year. Other major fallers in the chart include Malaysia and New
Zealand.

According to Grant Thornton International’s Alex MacBeath, the fall
of last year’s two strongest performers India and Hong Kong was the
most significant finding in the survey. "We expected continued strong
performance and may be one of them would possibly take top spot this
year," MacBeath said.

He added, however, that a drop in the number of super growth
companies should not be necessarily considered a bad thing for an
individual economy.

"Growth in employee numbers and turnover can only realistically be
expected to grow rapidly for a limited time before responsible
businesses take stock and review their growth strategies," he said.

There could be a consolidation in Hong Kong and India with those
super growth businesses of the last few years probably concentrating
on profitability rather than simply on high levels of growth,"
MacBeath said.

The Super Growth Index is published by Grant Thornton in its
International Business Report (IBR), which is based on opinions of
7,200 privately-held businesses in 32 countries and represents 81 per
cent of global GDP.