The polarisation of corporate profits in India is reducing

In the decade running up to COVID-19, corporate profits were increasingly polarised in India. The top 20 listed companies accounted for a significant share of India Inc's profit pie. Since FY21, smaller companies have grown their profits faster. Profit democratisation owes much to: (a) the India Stack and UPI, (b) the widespread availability of affordable credit and (c) the rise of social media as a medium for smaller companies to reach customers. Interestingly, though the stock market seems to have overdone its enthusiasm for small caps - the top 20 companies' share of the BSE 500 market cap now stands at 35 per cent, the lowest in this century.