A list of India’s most valued brands once again shows the diverging fortunes of two brothers helming India’s wealthiest business dynasty.
The brand value of the Anil Ambani-led Reliance Group underwent a sharp erosion in the past year, even as elder brother Mukesh Ambani’s three-year-old telecom venture Reliance Jio debuted among India’s 100 most valued brands.
The Reliance Group’s brand value fell 65% to Rs 3,848 crore in the past year – the biggest drop among Indian companies. The conglomerate is now ranked 56, down 28 places from 2018, in this year’s Brand Finance India 100 list that’s topped by the Tata Group.
The list was released by Brand Finance, a London-based independent strategy consultant, on July 16.
The reason for the fall is the turmoil at various businesses of the Reliance Group. Reliance Communications, once counted among the country’s leading telecom brands, for instance, is facing insolvency proceedings at India’s National Company Law Tribunal.
“The [Reliance Group] brand has witnessed continuous erosion in its value creation due to increased pressure from various group businesses and is currently facing some stiff questions from its stakeholders,” said David Haigh, chief executive officer, Brand Finance.
In March this year, a last-minute bailout from his elder brother helped Anil Ambani stave off a jail term for non-payment of dues by RCom to the Swedish telecom equipment maker Ericsson. His group’s power firm RPower, defence venture Reliance Naval and Engineering, and infrastructure firm Reliance Infrastructure, are also in debt.
In contrast, Mukesh Ambani’s Reliance Jio, a part of his conglomerate Reliance Industries Ltd., has a brand value of $3.6 billion and is at rank 14 on the Brand Finance India 100 list. Identified as a challenger brand, Jio is the most promising new entrant, according to the report.
“Reliance Jio is poised to become India’s leading telecommunications provider and it’s likely to retain its low-price strategy,” said Haigh.
Brand Tata, perched on top for a second straight year, saw its value rise 37% to $19.6 billion, surpassing the combined value of the state-owned Life Insurance Corporation of India and India’s second-largest IT firm Infosys.
The Mahindra & Mahindra conglomerate has also made it to the top 5 for the first time. The group’s brand value grew 35% to reach $5.2 billion.
It has a strong play in the farm equipment with sector Mahindra Tractors, financial services with Mahindra Finance and IT services with Tech Mahindra. It has been making strong inroads into US markets and chasing global growth aggressively, the report, said.
Besides Jio, the other debutants in the list include the hypermarket chain DMart with $937 million at rank 33 and the homegrown FMCG brand Patanjali with $614 million at rank 51.
Besides brand value, Brand Finance also evaluates the relative strength of brands, based on factors such as marketing investment, familiarity, customer loyalty, staff satisfaction, and corporate reputation.
Reliance Jio, HDFC Bank and Indian Oil are India’s strongest brands, according to the company.
The financial services sector shines in the Brand Finance India 100 this year, with as many as 14 banking brands featuring in the list.
India’s three largest lenders have registered strong growth in their brand value. At $6 billion, up 34% over last year, the State Bank of India tops the sector, followed by HDFC Bank, up 19% to $4.9 billion and ICICI Bank, up 41% to $3.9 billion.
“The banking sector is currently undertaking a major shift as a result of an increase in spending on infrastructure, technology and innovative customer experience tools, all of which have the potential to contribute to heightened brand values across the board for banks,” said Haigh.
Autos command trust
Automobile companies emerged as the most trustworthy brands, delivering on quality and innovation. Even though German marquee brands Mercedes, Audi and BMW enjoy the highest levels of consumer trust, their Indian rivals Tata Motors and Bajaj are also placed high.
Even as many technology-powered auto brands are seeking to become leaders in personal transportation, established auto brands have strong consumer equity – both globally and in India – and are not going to give way easily, noted the report.
Another interesting finding of the report is that consumer confidence in technology brands is high.
Indians trust and love global players such as Google, YouTube and Apple, which enjoy strong brand reputation in India. “Consumers feel that these brands broadly deliver on their product-service promises,” said Haigh. “Notably, their scores for trust are also high. Indian consumers trust most tech brands, including Facebook and Uber, which have a mixed reputation in other parts of the globe.”
This article first appeared on Quartz.
Respond to this article with a post
Share your perspective on this article with a post on ScrollStack, and send it to your followers.