The 25 brands in the Brand Finance league table are ranked on brand value: the value of the asset at a point in time assessed using the relief royalty method.
A prerequisite of the top Indian brands was that they were listed in the top 500 on the Bombay Stock Exchange - which is why brands like Hutch, Sahara India Pariwar and Kingfisher Airlines were not included. The top 500 by market capitalisation were shortlisted to 50, of which the top 25 made the final ranking.
In some cases, the lack of information on the Indian businesses of certain major international brands (Coca-Cola, Pepsi and so on) meant they had to be left out. Holding companies that own a portfolio of branded businesses (Hindustan Lever, for instance) were excluded, since it isn't possible to identify revenue streams for individual brands from publicly available sources.
Not surprisingly, Indian Oil Corporation emerges as the most valuable brand with a trademark value of $5.6 billion.
This value accounts for 40 per cent of IOC's market value, representing the amount by which the brand is likely to enhance the company's future cash flows. But despite its high value IOC is at risk of losing the brand revenues it currently enjoys to more powerful brands like Bharat Petroleum in the future.
| HOW THEY STACK UP | |
| Brand | Trademark |
| Indian Oil Corporation | 250,636 |
| State Bank Of India | 137,965 |
| Bharat Petroleum Corp Ltd | 134,673 |
| Tata Consultancy Services | 123,485 |
| Reliance Industries | 122,240 |
| Hindustan Petroleum Corp Ltd | 116,271 |
| Oil & Natural Gas Corp | 88,822 |
| Tata Motors | 84,652 |
| ICICI Bank | 76,777 |
| Wipro | 67,681 |
| ITC | 64,406 |
| Infosys Technologies | 63,534 |
| Gail India | 58,178 |
| Bharti Televentures | 54,018 |
| Tata Steel | 44,059 |
| Larsen & Toubro | 39,658 |
| Ranbaxy Laboratories | 29,038 |
| Bajaj Auto | 27,186 |
| Satyam Computer Services | 24,302 |
| Hero Honda Motors | 20,580 |
| Industrial Development Bank of India | 18,830 |
| Housing Development Finance Corp | 14,665 |
| HDFC Bank | 11,992 |
| Jet Airways India | 10,410 |
| Grasim Industries | 8,003 |
State Bank of India and Bharat Petroleum Corp follow in second and third place respectively, with brand values of just over $3 billion each. SBI has improved its brand power by engaging with consumers and developing products and services that are differentiated.
However, the bank still has enormous value potential and has only scratched the surface as of now. If SBI continues to invest in marketing and pushing up its service delivery, it will give other banks a run for their money.
Meanwhile, BPCL's pioneering efforts in retail marketing, including branded petrol, petrocards, fleet cards, convenience stores, one-stop shops and its "Pure for sure" logo still give it the edge over other oil PSUs. It is aggressively looking at increasing non-fuel revenues by leveraging its brand.
The first set of private sector brands, Tata Consultancy Services and Reliance Industries, follow, both worth over $2.7 billion each.
It will be interesting to see how the two brothers extract value from the Reliance brand in future, given that Reliance Communication Ventures is now listed and Mukesh Ambani's retail plans are in overdrive. There are also some strategic issues that remain unresolved, including how the corporate brands of the two groups will be separated and yet at the same time keep the Reliance brand robust.
The top echelons have some diversity in terms of Tata Motors, demonstrating the company's focused strategy of cross-border acquisitions, strategic alliances and a steady stream of new product launches - Ace, Dicor, Starbus and Globus and its commitment to build the Rs 1 lakh car. This brand is ready to make a global mark.
Smaller banks, such as ICICI Bank, are rapidly boosting their brand power by offering customers holistic financial services and a certain level of functional and service delivery.
While SBI and Bank of Baroda are waking up to the role of the brands inside their businesses, ICICI Bank is now trying to forge an emotional connection with its customers with its Hum hai na communication.
The benefits of ICICI leveraging its brand are visible - it has registered 95.61 per cent five-year CAGR growth of fee income. Fee income is a good barometer to gauge a bank's efficiency in using its brand and customer capital through cross selling. All other Indian banks - including HDFC Bank - have a lot of catching up to do.
Despite the fact that TCS is smaller in terms of brand value than IOC, it is India's most powerful brand in terms of its ability to sustain earnings into the future with the least risk. If TCS continues build up intellectual property, create strategic alliances and extend its footprint into new services where it can extract volume and premium, its rise in the value table will not be surprising.
Wipro emerges as the second most valuable and powerful IT brand. This comes after a year of acquiring firms, giving Wipro access to new skills and intellectual property, upping marketing spends and ramping up to scale the consultancy target.
Wipro's product engineering and design services are especially pushing hard to deliver on innovation to create and sustain revenue streams for the future. The evidence towards a more IP and marketing driven model lies in the number of patent applications that have been made by TCS and Wipro over the past three to four years.
For an industry caught between run-of-the-mill software services and high-end products, IP licensing and sales will not only boost financial returns but also build long-term competitive advantage.
Infosys has made some inroads into high end consulting. However, it needs to urgently review its IP and marketing investments and come out victorious in the battle to protect its well-known trademark.
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