How many mncs are there in india

Economies of scope exists whenever the some investment can support multi-profitable activities, which are less expensive. Examples abound of the cost advantages of producing and selling multiple products related to common technology, production facilities and distribution network.

For example, Honda has increased its investment in small engine technology in the automobile, motorcycle, marine engine, and generator business. One possibility is to enter new markets where little competition currently exists. Many electronics and textile firm in the United States US shifted their production facilities to Asian locations such as Taiwan and Hong-Kong to take advantage of the lower labour costs. It is often possible for an MNC to sell its knowledge in the form of patent rights and to licence foreign producer.

This relieves the MNC of the need to make foreign direct investment. However, sometimes an MNC that has a Production Process or Product Patent can make a larger profit by carrying out the production in a foreign country itself. The reason for this is that some kinds of knowledge cannot be sold and which are the result of years of experience. In some situation, MNCs invest to exploit their reputation rather than protect their reputation. This motive is of particular importance in the case of foreign direct investment by banks because in the banking business an international reputation can attract deposits.

If the goodwill is established the bank can expand and build a strong customer base. Quality service to a large number of customers is bound to ensure success. This probably explains the tremendous growth of foreign banks such as Citibank, Grind-lays and Standard Chartered in India. Normally, products, develop a good or bad name, which transcends international boundaries. It would be very difficult for an MNC to protect in reputation if a foreign licensee does an inferior job.

Therefore, MNCs prefer to invest in a country rather than licensing and transfer expertise, to ensure the maintenance of their good name. MNCs prefer direct investment, rather than granting a license to a foreign company if protecting the secrecy of the product is important.

While it may be true that a license will take precautions to protect patent rights, it is equally true that it may be less conscientious than the original owner of the patent. The fact that MNCs have access to capital markets has been advocated as another reason why firms themselves moved abroad.

A firm operating in only one country does not have the same access to cheaper funds as a larger firm. However, this argument, which has been put forward for the growth of MNCs has been rejected by many critics. It has been argued that opportunities for further gains at home eventually dry up. To maintain the growth of profits, a corporation must venture abroad where markets are not so well penetrated and where there is perhaps less competition.

This hypothesis perfectly explains the growth of American MNCs in other countries where they can fully exploit all the stages of the life cycle of a product.

A prime example would be Gillette, which has revolutionized the shaving systems industry. MNCs prefer to invest directly in a country in order to avoid import tariffs and quotas that the firm may have to face if it produces the goods at home and ship them.

For example, a number of foreign automobile and truck producers opened plants in the US to avoid restrictions on-selling foreign made cars. Automobile giants like. Fiat, Volkswagen, Honda and Mazda are entering different countries not with the products but with technology and money. The strategic motive for making investments has been advocated as another reason for the growth of MNCs. MNCs enters foreign markets to protect their market share when this is being threatened by the potential entry of indigenous firms or multinationals from other countries.

Some firms have followed clients who have made direct investment. This is especially true in the case of accountancy and consulting firms. Large US accounting firms, which know the parent companies special needs and practices have opened offices in countries where their clients have opened subsidiaries. These US accounting firms have an advantage over local firms because of their knowledge of the parent company and because the client may prefer to engage only one firm in order to reduce the number of people with access to sensitive information.

When making over direct investment it is necessary to allow for risk due to investments being made in a foreign country. Country risk is one of the special issues faced by MNCs when investing abroad. In involves the possibility of losses due to country-specific economic, political and social events. Among the country risks that are faced by MNCs are those related to the local economy, those due to the possibility of confiscation i.

Government take over without any compensation, and those due to expropriation i. Even though none of these latter events are specifically directed towards on MNC by the foreign government, they can damage or destroy an investment.

There are also risks of currency non-convertibility and restriction the repatriation of income. International magazines like Euro Money and the Economist regularly conduct country risk evaluations in order to facilitate MNCs. Most of the MNCs try to prevent operations in developing countries by other local entities without their cooperation. The Coca Cola Co. It has a wide range of products including beauty, grooming health and household care etc.

A well known Japanese Multinational Company dealing in televisions, mobile phones, cameras, PlayStations, headphones and memory cards, etc. Samsung was founded in the year in Daegu, Japanese Korea. It hold its place every time whenever the topic best 25 multinational companies in India is raised. TCS is an Indian multinational information technology IT service and consulting company and also the second largest Indian company by market capitalization. In , the company hired around , employees in India.

It is the largest food company in the world, measured by revenues and other metrics, since Aditya Birla Group is an Indian multinational conglomerate, headquartered in Mumbai. It operates in 35 countries with more than , employees worldwide.

Sectors include viscose staple fibre, metals, cement, viscose filament yarn, branded apparel, carbonblack, chemicals, fertilisers , insulators, financial services, telecom, BPO and IT services. HP produces line of printers, digital cameras, scanners, PDAs, calculators, servers, workstation computers, and computers for home and small-business purpose.

Dell sells personal computers PCs , servers, data storage devices, network switches, software, computer peripherals, HDTVs, cameras, printers, MP3 players, and electronics. Dell is one of the largest technological corporations in the world, employing nearly 1,45, people in the U. Stock analysis. Market Research. Nifty 18, Zomato Ltd. Market Watch. ET NOW. Brand Solutions. Video series featuring innovators.

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