As far as the country’s economic development is concerned, private companies in India are quite significant. Each private company has its unique business model and specific types of private companies, with formation followed by different legal provisions and ownership structures. Companies must also comply with compliance regulations under the Companies Act 2013 and other legal frameworks. This article focuses on the different business models, types, formation, ownership, and compliance requirements for some of the top private companies in India, like Reliance Industries Ltd, Tata Consultancy Services (TCS), Infosys Ltd, HDFC Bank, Hindustan Unilever Ltd, and more.
Top 10 Private Companies in India
India has several top private companies that drive economic growth and innovation. These companies excel across technology, finance, manufacturing, and retail industries.
Reliance Industries Ltd (RIL)
Reliance Industries is a public limited company incorporated under the regulations of the Bombay Stock Exchange (BSE) and was founded by Dhirubhai Ambani in 1966 as a small textile company, which, over the years,s has gradually extended to many segments. However, regardless of the public trading, it is largely a controlled company under the Ambani family.
Business Model of Reliance Industries
The business model of Reliance Industries is diversified across petroleum, retail and telecommunications (Jio), media and natural resources. Keeping such a diversified business model, Reliance can invest not only in traditional industries like petrochemicals and refining but also in emerging markets such as telecommunications and digital services, hence hedging its risks.
Reliance focuses heavily on vertical integration. So, the whole supply chain is under its control for most of its sectors. For instance, Jio is a telecommunications business that takes care of everything from network infrastructure to customer experience, which gives it a competitive edge. It’s also the organisation’s continued focus on digital innovation and sustainability.
Ownership Structure
Reliance is a publicly traded private company, and the different portions of ownership are held by its shareholders, one of whom is the Ambani family, which carries a huge proportion of the company’s equity. It is a concentrated ownership structure, and the company has no public shareholding beyond current investors.
Compliance for Reliance Industries
Reliance, as a company listed on the stock exchange, follows the compliance conditions prescribed under the Companies Act 2013, which deals with provisions related to formation, functioning, and compliance for all companies in India. As a public company, Reliance must also follow other requirements from the Securities and Exchange Board of India (SEBI), such as taxation laws, environmental laws, and other sector-specific compliance rules.
Tata Consultancy Services Ltd (TCS)
TCS was established in 1968 as a subsidiary of the Tata Group. Having started data processing services, it is one of the largest IT providers worldwide. It operates as a public limited company, with the Tata Group as the major stakeholder.
Business Model of TCS
Tata Consultancy Services (TCS) is a narrow-based IT consulting company that provides software and digital transformation services. It has cloud computing, big data analytics, enterprise solutions, and business process outsourcing (BPO)-among many other services.TCS’s revenue is mainly from the technology solution and consulting business catering to its global clients in the banking, insurance, telecoms, and retail sectors.
TCS is well-known for its customer-centric approach; thus, the company has devised its business model to build long-term relations with clients for their digital and technology transformation.
Ownership Structure
TCS holds its character as a public limited company, and shares reflecting its valuation are listed on the Bombay Stock Exchange (BSE) and National Stock Exchange (NSE). The public listing doesn’t affect the controlling stake owned by the Tata family since it retains that because of its ownership in Tata Sons Ltd, the holding company of the Tata Group.
Compliance for TCS
TCS must comply with the Companies Act 2013, Securities and Exchange Board of India (SEBI) regulation, tax regulations, and global compliance standards, as it operates in multiple countries. In addition, it has to observe data protection and privacy regulations, especially as it handles large amounts of client data.
Infosys Ltd
Infosys was founded as a private limited company in 1981 by Narayana Murthy and a few other professionals. It became one of the world’s premier IT services firms and later made its Initial Public Offering (IPO) in 1993.
Business model of Infosys
Infosys operates in the global IT services and consulting market. Its business model is based on providing consulting services, system integration, and technology outsourcing to enterprises across various industries. This research includes artificial intelligence (AI), cloud computing, and blockchain solutions and services that directly involve digital transformation.
Long-term client relationships and a value commitment to innovation and sustainability are the main focuses of the Infosys model. It serves global clients, including large financial services, healthcare, and manufacturing corporations.
Ownership Structure
Infosys began its journey as a private company in India and is now publicly traded due to its IPO. However, the company’s comparatively large stakeholder portion continues with founders and early investors. On a fully public platform, Infosys still operates as a family-controlled company, with its founders and promoters holding the most shares.
Compliance for Infosys
Being a publicly listed company, Infosys falls under SEBI regulations, the Companies Act 2013, various global compliance standards, and data protection laws. Compliance is also ensured with the corporate governance guidelines that these countries have set, along with their tax regulations.
HDFC Bank Ltd
In 1994, we saw the incorporation of HDFC Bank as a private limited company under Deepak Parekh’s stewardship. HDFC Bank, within a very short period after its inception, became one of the most accepted and one of the major private-sector banks in India, providing a range of banking products aimed at Indian customers.
Business Model of HDFC Bank
HDFC Bank’s business approach mainly concentrates on retail banking, corporate banking, and wealth management services. HDFC Bank provides a wide menu of services, including credit cards, loans, home loans, and several types of insurance. HDFC Bank seeks to serve retail and important corporate clients, offering them customised and innovative financial offers.
The bank utilises technology and a digital banking environment to provide sophisticated customer experiences and a quick process for availing financial services. Thus, this model has focused on expanding its customer base and forwarding clients a broad range of financial products.
Ownership Structure
HDFC Bank is a publicly listed company whose shares are traded on the Bombay Stock Exchange and the National Stock Exchange. Although publicly traded, its promoter company is HDFC Ltd, which retains significant shareholding. Hence, it is also regarded as a promoter-driven organisation.
Compliance for HDFC Bank
As a bank, HDFC Bank has to abide by various rules and regulations as laid down by the Reserve Bank of India (RBI), by SEBI in respect of its transactions in the stock market, and by laws of taxation. The bank must also follow provisions for enforcing anti-money laundering (AML) and know-your-customer (KYC), as well as data protection concerning the customer’s financial details.
Hindustan Unilever Limited (HUL)
HUL began in 1933 as a subsidiary of Unilever, a British-Dutch multinational. Though registered as a private limited company, it is publicly listed on the Bombay Stock Exchange, while Unilever, an equally public-listed company, maintains majority operational control.
Business Model
One of India’s largest consumer goods companies, Hindustan Unilever Ltd (HUL), has a business model focused on fast-moving consumer goods (FMCG) within personal care, home care, food and beverages, and healthcare. HUL runs through a diversified portfolio of brands that include Dove, Knorr, Lipton, and Lifebuoy.
At HUL, the business model focuses on brand-building and the diversification of products. That enables the company to offer products in diverse segments of the market, from premium and mid-range to those aimed at budget-conscious consumers. Besides this, the company practices sustainability and corporate social responsibility.
Ownership Structure
It is a public limited company, but the company is, de facto, under the control of Unilever. The state controls a large stake in HUL. The rest of the shares are available to public and institutional investors. In that sense, even if it’s publicly listed and traded, Unilever has the power to make major business decisions given the significant shares it holds.
Compliance for Hindustan Unilever Ltd
HUL is bound by the Companies Act 2013, the SEBI regulations, and all Indian Regulations. In addition to compliance with the stipulated Indian laws, qualifying HUL as a company listed on stock exchanges should comply with various international compliance standards, especially concerning environmental footprints and supply chain management.
ICICI Bank Ltd
In 1994, ICICI Bank started as a wholly owned subsidiary of ICICI Ltd (Industrial Credit and Investment Corporation of India). The bank was later converted into a public limited company, and shares were offered to the public in its initial public offering (IPO) in 1998.
Business Model of ICICI Bank Ltd
ICICI Bank is among the largest private-sector banks in India and offers a full range of banking services, from retail banking, corporate banking, insurance, and investment banking. The business model is based on deploying financial products to individuals, businesses, and corporate clients. ICICI Bank intends to attract a new class of tech-savvy consumers to use its digital banking services.
This continued investment in technology, online banking services, mobile applications, and digital payment systems enables them to be true to their promise of high customer satisfaction in a rapidly growing sector in India.
Ownership Structure
The ownership structure of ICICI Bank is that it is a public limited company with shares listed on the Bombay Stock Exchange and National Stock Exchange (NSE). While ICICI Group and promoters still hold a significant stake in the company, the rest of the shares are traded publicly, thus widening its shareholder base.
Compliance for ICICI Bank
As a major bank, ICICI Bank must comply with RBI regulations, SEBI guidelines, and taxation laws of the land. At the same time, it is also equally bound by international statutes specific to AML, KYC, and data protection.
Bharti Airtel Ltd
Bharti Airtel was founded as a private limited company by Sunil Bharti Mittal in 1995. Since its inception, it has grown into one of India’s largest telecom providers. Bharti Airtel went public in 2002 and is now a public limited company on the National Stock Exchange and Bombay Stock Exchange.
Business Model of Bharti Airtel Ltd.
Bharti Airtel is a major player in India’s telecommunications sector. Its business model centres on providing consumers and businesses with mobile services, broadband, and enterprise solutions. The company operates in over 18 countries, focusing on affordable mobile data services, 4G network expansion, and value-added services.
Besides telecom services, the company is exploring the digital domain with Airtel Xstream for TV, Airtel Payments Bank, and Airtel Business Solutions for corporate clients.
Ownership Structure
Bharti Airtel is a publicly held company, with many shares owned by institutional investors and the Bharti family. While shares can be traded publicly, the Bharti family continues to possess a sizable part of the overall control over the company’s decision-making processes.
Compliance for Bharti Airtel
The company has complied with regulations set forth by the Telecom Regulatory Authority of India (TRAI). However, this has borne spectrum-specific allocations in pricing regulations and interconnect agreements. On top of that, airtel has also followed all SEBI regulations as far as listed companies are concerned and direct RBI guidelines regarding digital banking and mobile payments.
Larsen & Toubro Ltd (L&T)
Founded in 1938, Larsen & Toubro was initially a private limited company that was open to business in importing and selling electrical equipment. It has grown to be a public limited company over the decades, and its shares are available for trading on the Bombay Stock Exchange (BSE) and National Stock Exchange (NSE).
Business Model of Larsen & Toubro
Larsen & Toubro is one of India’s major engineering and construction companies, primarily involved in infrastructure-related solutions for the power, water, transportation, defence, and industrial sectors. The model of business of L&T comprises large engineering projects such as smart city buildings, power plants, water treatment plants, and highways.
The diversification scheme of L&T, which also includes IT Services, Financial Services, and Realty Development, ensures that there are different principles of the operations of L&T across the various sectors.
Ownership Structure
Publicly traded company L&T is out there in the open market, yet, being exceeded by the company’s shares, it still holds quite a significant stake for the Larsen family. Such shares were made available to the public, but the promoter maintains strong control over the company’s operations and business strategy.
Compliance for L&T
Other than the Companies Act, 2013 and tax regulations, environmental requirements must also form the basis for L&T compliance, and the guidelines of the RBI about financing the infrastructures require this company to comply with them. L&T also follows the SEBI regulations for listed companies and meets the standards of corporate governance, being a publicly listed entity.
ITC Ltd
In 1910, it was established as the Imperial Tobacco Company of India Ltd. Gradually, it entered into several diversified areas through which it could become one of the top conglomerates in India. It was public and remained a public limited company, listed in the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE).
Business Model of ITC Ltd
ITC Ltd operates through diversified businesses like FMCG, hotels, paperboards, packaging, and agriculture. Some of the consumer goods the company is well known for are Aashirvaad (flour), Sunfeast (biscuits), and Classmate (stationery). Besides that, it has invested a lot in the hospitality sector, having many resort-type hotels under its brand.
The business model of ITC has a sustainable thrust, wherein the strong corporate commitment is to environmental responsibility and community welfare. The agribusiness division contributes from a raw materials perspective toward the country’s agricultural economy by procuring raw materials directly from farmers.
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Ownership Structure
ITC Ltd, as a public limited company, owns a large chunk of shares held mostly by institutional investors and the ITC promoter group. Though it is open to the public, it is still a promoter-driven organisation where key decisions are made with major institutional investors.
Compliances for ITC Ltd
The Companies Act 2013, taxation laws, environmental laws, and RBI guidelines mainly concern ITC Ltd’s activities in agriculture and hospitality and other business undertakings. Being a public limited company, the Corporate Governance rule followed by SEBI also applies to ITC Limited and its environmental sustainability standards.
Private Companies in India FAQs
What are private companies in India?
Private companies in India are owned by private individuals, persons, or entities, with restrictions to a few shareholdings. These companies do not issue shares to the public for subscription and do not operate commercially privately.
How are private companies formed in India?
Private companies in India are formed after registering with the Registrar of Companies (RoC), per the compliance requirements set in the Companies Act 2013.
What are the differences between private companies and public companies in India?
Private companies in India cannot publicly trade their shares because their shareholding is limited to a few people; in contrast, public companies can issue shares and are directly listed on stock exchanges.
What are the compliance requirements for private companies in India?
Tax regulations, some financial reporting standards, and the Companies Act, including annual returns and statutory maintenance of financial records,s are all complied with by private companies in India.
What are the benefits of private companies in India?
Greater control, speedy decision-making, and privacy with flexibility are some advantages private companies in India have over public companies.
