In an earlier post, we discussed about the companies from developed countries that have the potential to profit from emerging markets’ growth. Many companies in the emerging markets are already champions in their domestic markets and are poised to become global market leaders. This is especially true with BRIC companies.
The economic power is projected to shift from the US and Western Europe to the emerging countries in Asia and Latin America in the next decade and beyond. Goldman Sachs noted in a November report:
“Since 2001, we have focused on the increasing importance of BRICs countries in the
global economy; we believe they remain on a trajectory that will see their combined
output reach 50% of the G7 level by 2020 and parity between 2030 and 2050.” Emerging markets will see lots of action in the next few years and offer investment opportunities for global investors. Investing directly in emerging market equities requires access to those markets or one can invest via ADRs if they are available, ETFs or other vehicles.
Goldman Sachs has compiled a list of the ‘Nifty 50’ BRIC companies that are likely to become global winners in the next few years. Many of them are strong players in their respective industries. There companies were selected based on the following criteria:
- Returns on capital
- Industry positioning
- Management quality (with respect to environmental, social and governance issues)
The Nifty 50 BRIC companies are:
[TABLE=401]
Petrobras(PBR), Vale(VALE), Gazprom(OTC: OGZPF)Â were among the five companies with the largest market cap gains in this decade. With the global demand for natural resources rising, it is possible that they may continue the incredible growth into the next decade.
