Chinese companies are becoming more and more powerful. On September 1, the China Enterprise Confederation and the China Entrepreneurs Association released the list of the top 500 Chinese companies in 2019. Sinopec continued to rank first with 2.7 trillion. This time the entry threshold has been raised to 32.325 billion, an increase of 1.636 billion from 2018. Ranking 500th is China Dongfang Electric Group Co., Ltd. This means that Chinese companies are doing better and better, with overall revenue increasing by 12.41%.
In addition, among the top 500 companies, there are 194 companies with revenue exceeding RMB 100 billion, 22 more than in 2018, and an increase of 71 companies in 7 years. Revenue of 100 billion can be said to be a threshold. For many industries, it is definitely a leading company. What is the concept of 100 billion? It exceeds the GDP of many cities. Specifically, there are still 6 companies that have entered the "trillion club", and this one is even more powerful. It is the best company in China. This time, major cities are pursuing "one trillion GDP". Now, there are 17 cities with more than one trillion. These six companies can be ranked in the top 15. Among them, the revenue of Sinopec, PetroChina, and State Grid were 2,742.8 billion, 2,599.4 billion, and 2,560.3 billion, exceeding the 2018 GDP of Shenzhen and Guangzhou. Shenzhen’s GDP is 2,469.1 billion yuan and Guangzhou’s is 2,300 billion yuan.
If you look at a company as a city, these three companies can become China's first-tier cities, while the other three companies with over one trillion yuan can become new first-tier cities. So what are the origins of these six companies?
1. Sinopec
One of China’s two barrels of oil, Sinopec is a wholly state-owned enterprise founded in 1983 and reorganized into the current China Petrochemical Corporation in 1998. Sinopec and PetroChina basically divide domestic crude oil mining, refining, oil product sales, etc. Anyway, these two companies are basically the only places where oil is used.
Sinopec’s profit in 2018 was 100.3 billion yuan, a year-on-year increase of 15.88%. It had often received subsidies before, but it is still making money now. It has many subsidiaries and many oil fields. With 660,000 employees, Sinopec ranks second in this year's Fortune Global 500, second only to Wal-Mart. In fact, Sinopec has ranked first among the top 500 Chinese companies for more than ten consecutive years.
Gas stations may be the most closely related to ordinary people. It is understood that Sinopec has 30,121 gas stations across the country. In fact, Sinopec is China's largest convenience store chain company, with 25,000 EasyJet convenience stores, including one in almost every gas station.
2. PetroChina
PetroChina and Sinopec are both vice-ministerial enterprises and the two largest oil companies in the world. The two companies originally belonged to China National Petroleum Corporation. The Ministry of Industry, however, was split into two companies, Sinopec and PetroChina, in 1998 in order to prevent monopoly after joining the WTO.
In 2018, PetroChina’s net profit was 52.591 billion yuan, a significant year-on-year increase of 130.7%, which was much worse than Sinopec. PetroChina's business is actually similar to that of Sinopec, and the two companies divide the market. It owns many well-known oil fields, such as Daqing Oil Field. It has more than 100 subsidiaries and 1.47 million employees.
3. State Grid
State Grid is also a great central enterprise. In addition to the five provinces and regions of China Southern Power Grid, namely Guangdong, Guangxi, Yunnan, Guizhou and Hainan, the State Grid manages Other provinces and cities fall under the scope of the State Grid, covering 88% of the area and a population of 1.1 billion. Electric power can be said to be an industry related to the lifeblood of the national economy and is very important.
State Grid ranked 5th among the Fortune Global 500 in 2019. It ranked 2nd in 2018, falling three places, with a total profit of 78.01 billion yuan, less than 100 billion yuan, still It is not as good as the four major banks, with total assets of 3.9 trillion and 465 million customers served. State Grid is also a very innovative company, ranking first in China in terms of the number of patent applications it has applied for, surpassing Huawei. In addition, the number of employees of State Grid reached 910,000.
4. China State Construction
China State Construction Group Co., Ltd. is China's largest construction enterprise group and largest international contractor. It was established in 1982. The business scope includes house construction, infrastructure construction, real estate development, etc. This is a super giant construction company, which is basically a national project. It is present in airports, bridges, subways, landmark buildings, etc., such as Shenzhen International Trade Center, Guangzhou New Baiyun Airport, CCTV Pants Building and other well-known buildings. Responsible for China State Construction Engineering Corporation.
Among the Fortune Global 500 in 2019, China State Construction ranks 21st and fourth among Chinese companies, with revenue of 1.1993 billion yuan and net profit of 22.6 billion yuan. It has many subsidiaries, including 23 companies in the construction engineering sector, 17 in the international engineering sector, 10 in the real estate sector, and 7 design institutes. Of course, China Construction is most famous for its eight bureaus. In 2018, China Construction First Engineering Bureau had revenue of 100.6 billion yuan, China Construction Second Engineering Bureau had revenue of 133.8 billion yuan, China Construction Third Engineering Bureau had revenue of 237.3 billion yuan, and China Construction Fourth Engineering Bureau had revenue of 237.3 billion yuan. The revenue of China Construction Engineering Corporation 5 was 232 billion yuan, the revenue of China Construction Fifth Engineering Division was 100 billion yuan, the revenue of China Construction Sixth Engineering Engineering Division was 100 billion yuan, the revenue of China Construction Seventh Engineering Engineering Division was 83 billion yuan, and the revenue of China Construction Eighth Engineering Engineering Division was 214.6 billion yuan. The revenue of the Eight King Kongs basically exceeds 100 billion.
It is understood that China Construction Group has been rated as an "Enterprise with Outstanding Performance" by the State-owned Assets Supervision and Administration Commission for five consecutive years. It can be seen that the performance is indeed good. After all, resources for state-owned projects are not easily available to anyone.
5. Industrial and Commercial Bank of China
Needless to say, "the largest bank in the world", among the top 500 Chinese companies in 2019, ICBC became the most profitable in China with a net profit of 297.676 billion. The company earns 815 million per day. However, this is only the result in 2018. Just recently, ICBC released its performance report for the first half of 2019, which showed that its profit was 168.69 billion yuan, with a daily profit of 930 million yuan. This means that ICBC earned another 100 million yuan per day. It is said that this profit is equivalent to 3 Tencent and 8 Maotai.
Besides, the profit of 297.676 billion can be ranked among the top 66 of the top 500 companies in terms of revenue. Vanke Group’s revenue is 297 billion, ranking 67th. ICBC's profit is equal to Vanke's revenue, which makes many companies feel ashamed. It is understood that ICBC's income mainly comes from interest. So many corporate loans and so many personal housing loans are actually working for the bank. While the company works for the bank, you can still get a little bit of it, but it is purely a personal expense. This house will not make you any money, except of course for real estate speculators.
6. Ping An Insurance
Ping An of China is a company with very dispersed equity. It is neither a state-owned enterprise, a private enterprise, nor a foreign capital. It does not have an absolute controlling party, but it is A very profitable company, being a shareholder of Ping An is basically making money while lying down.
In 30 years, Ma Mingzhe built a company that started with RMB 20,000 into the world's largest insurance company with assets of over RMB 5 trillion. Ping An's business is very extensive, with insurance as its core business, as well as banking, securities, funds, P2P, medical and other industries. Revenue was 1.1993 billion and net profit was 107.4 billion. However, like Industrial and Commercial Bank of China, profits surged again in 2019, with a net profit of 97.676 billion yuan in the first half of the year, and a daily profit of nearly 540 million yuan. The half-year profit is almost catching up with last year's full-year profit. It seems that Ping An's profit this year will exceed 200 billion, which means it will compete with the four major banks.
The revenue of these companies is so high, it can actually be understood that they are resource-intensive, that is, their business cannot be shared by others. Needless to say, PetroChina, Sinopec, and State Grid. However, fortunately, private companies are now finding development opportunities in other industries, such as Huawei, which has a revenue of more than 720 billion, which is also very impressive. Suning Group has more than RMB 600 billion and its business scope is also very wide. In the future, more private enterprises will hit the "trillion club".
In fact, the fact that the top 500 giants are getting stronger and stronger means that the survival space of companies outside the top 500 is getting smaller, which means that the life of small and medium-sized enterprises will not be so easy. Of course, fortunately, the Internet is the last piece of pure land, and state-owned assets are not involved too much. There is still a chance to emerge as a giant.