This is not the first time the building materials company has changed its name. Formerly known as Hyderabad Industries Ltd, the company renamed itself as HIL in 2012. The latest rebranding may be the company’s attempt to reposition itself as a more contemporary player in the roofing solutions sector, said experts.
“When the younger generation starts taking the reins of their family businesses, they often want to introduce a sense of refreshment which aligns with their vision for the businesses,” Bharadwaj Jaishankar, partner at IndusLaw, told Mint.
Next-generation entrepreneurs incorporating modern technology in their business want to signal the shift by adopting a new name that can create a savvy perception, but also want to capitalise on an established brand by retaining it in some capacity, added Jaishankar.
BirlaNu and Birla Opus are the most recent examples of such a rebranding exercise.
A deeper desire
While the CK Birla Group’s flagship company has been using the BirlaNu name internally for about two years, the public announcement and new logo suggest a desire to signal more than just a name change, Jaishankar said.
Companies change their identity for various reasons, from mergers and acquisitions to evolving business strategies, tarnished reputations, or to attract a new audience. “Sometimes, they would change names to gain media attention as well,” Jaishankar said.
The merger of Vodafone India Ltd and Idea Cellular Ltd in 2017 created a telecommunications giant called Vodafone Idea, exemplifying a name change driven by consolidation. DB Realty’s new identity, Valor Estate, reflects a strategic shift to craft a more trusted brand image associated with innovation, sustainability, and customer focus.
This trend of identity transformations is significant, with over 1,100 Indian companies adopting new names in the past two decades. These changes range from minor tweaks, like dropping a word, to complete overhauls or even changing the colour schemes of their logos to target a particular class of customers.
A striking trend
While recent years have seen a steady pace of around 70 name changes annually, 2010 witnessed a peak of 101 such transitions, showed a Mint analysis of Capitaline data.
In terms of sector representation, companies in the banking, financial services, and insurance (BFSI) sector accounted for the largest share of name changes (about 16%), showed the analysis. Construction and real estate companies followed with 8.4% share, while the information technology sector represented 7.4%. The power and oil and gas sectors had the lowest share, at only 1%.
While identity changes are a familiar corporate manoeuvre, a striking trend is emerging in the public market: a significant number of newly listed companies are swiftly revamping their brand identities.
Is the intense pressure to differentiate themselves in the crowded marketplace the primary driver? Mint’s analysis suggests this could be one of the factors, revealing that over a third of companies change their identities within five years of their initial public offering (IPO).
Zomato’s name change, for instance, came after less than four years of the company listing on the bourses.
Mint’s analysis also revealed that name changes aren’t limited to the immediate post-IPO period. Around 7% of firms opted for a new name between six and 10 years after listing, while another 10% did so between 11 and 15 years. This data indicates that brand evolution remains a relevant consideration for companies even as they mature in the public market.
“At the end of day rebranding is an exercise, for amongst other reasons, to stay relevant and known. Mature companies keep refreshing their logos every now and then for this reason,” Jaishankar said. “Even though it is a cosmetic makeover on the surface, it signifies a strategic shift underneath which involves months of preparation and approval from stakeholders.”
Interestingly, identity transformation isn’t always a reaction to public listing; it can also be a proactive pre-listing strategy. Swiggy’s name change from Bundl Technologies Pvt. Ltd to Swiggy Pvt Ltd, undertaken before its IPO, for ‘brand proximity’, exemplifies this trend.
However, no matter what a company’s motivations are, stock prices have traditionally reacted positively to rebranding, the analysis showed. In 2024, stocks of 30 companies offered positive median returns on and after the day of their name changes.
HIL’s shares ended Thursday 0.83% higher at ₹1,825.00 apiece on NSE, slower than the benchmark Nifty 50’s 1.24% rise.
Experts, though, pointed out that there was hardly any correlation between a company’s rebranding and its stock price movement. “Usually, stocks react only if there is any value proposition for the investors in the rebranding. Like if the company is launching a new sub-brand or going for a merger or acquisition,” said Raghav Manohar Narsalay, partner and leader at research and insights hub at PwC India.
