Alibaba, Tencent included in Fortune Global 500 list for the first time

Alibaba Group and Tencent Holdings have been included in the latest edition of the Fortune 500 list of global companies, reflecting their debuts on the prestigious business rankings and underscoring the growing prominence of Chinese companies on the world stage.

Alibaba, with revenue of US$23.5 billion, ranked No 462, closely followed by Shenzhen-based Tencent in 476th, with revenue of US$22.9 billion, according to the Fortune Global 500 list for 2017 released on Thursday. Baidu, the Chinese search engine giant, did not make the top 500 list.

New mainland entrants also included Country Garden and Anbang Insurance Group.

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Arguably the most notable riser on the list was HNA Group, the owner of Hong Kong Airlines. The company’s global shopping spree for assets helped elevate it to 170th this year, a considerable jump from its 2016 ranking as No 353. HNA founder Chen Feng said in May that it was his personal ambition to elevate the company into Fortune’s list of the world’s 100 largest companies.

China has 115 companies on this year’s list, up from 98 in 2016, with state-owned energy providers State Grid, Sinopec Group and China National Petroleum ranking second, third and fourth respectively. The largest company worldwide remains Wal-Mart Stores, with revenue of US$485.9 billion.

With revenue singled out as the sole criterion for a company’s size in the Fortune list, those firms who operate in capital intensive industries such as property or the business-to-consumer retail sector tend to be given an edge in the rankings.

Historically, the vast majority of Chinese companies on the Fortune 500 list were state-run companies such as energy and banking with quasi monopoly status. But in recent years privately-owned tech names have climbed up the world rankings.

For example, Huawei, the world’s largest maker of telecommunications equipment, qualified for Fortune’s list of the world’s 100 largest companies in 83rd spot this year.

JD.com, whose revenue comes from direct sales for which it acts as the merchant, made its debut on the Fortune 500 list last year in 366th spot, becoming China’s first-ever internet firm to be included. This year it ranked No 261, even as its market value of US$61.5 billion is just a fraction of the US$360 billion for Tencent and US$388 billion for Alibaba.

Tencent’s shares were up as much as 1.4 per cent in Hong Kong on Friday after the release of the business rankings.

Among financial services firms, Ping An, the mainland’s biggest insurer, beat out Bank of China to break into the top 40 list, appearing alongside ICBC, the Agriculture Bank of China and China Construction Bank.

Alibaba is the owner of South China Morning Post.