Number of domestic companies exceeds that of US for first time since rankings began in 1990

The latest Fortune Global 500 list reveals more than that Chinese firms outnumber counterparts from the United States, but also demonstrates how China's private sector is reshaping the global business landscape, experts said.

Chinese companies accounted for 129 of the world's 500 largest corporations by revenue, according to the list published on Monday, exceeding the US, at 121, for the first time since the rankings began in 1990.

China was also the top performer in terms of newcomers and companies with the largest leaps in rankings. Most Chinese enterprises on last year's list had higher rankings this year.

"China's performance indicates that the torrents of merger and acquisition activities aiming to forge globally influential conglomerates are starting to pay off," said Jiang Qingyun, a business professor at Fudan University's School of Management. "It's a natural reflection of the country's overall economic status."

Of the 25 companies that made their debut or reentered the list, 13 were from China. They included State policy lender China Development Bank, the world's largest rolling stock manufacturer CRRC and mobile phone maker Xiaomi.

China led in the number of metal, construction, automotive and real estate companies. However, healthcare and medical companies in the US outnumbered Chinese counterparts on the list.

"On the plus side, China is shaping up to have a number of major enterprises in select industries," Jiang said. "Meanwhile, the temporary lack of consumer-sector businesses from China on the list indicates that the vast domestic market has yet to be fully tapped and there is plenty of room for growth."

Chinese technological powerhouses are making strides. Huawei moved up to 61 from 72 last year. Among the 10 companies registering the biggest jumps, six came from China, including tech titans Alibaba Group which was up 118 spots to 182, as well as Tencent, which moved up 94 places to 237.

"The fostering of Chinese companies in the digital area, such as providing better financing channels like the STAR Market, is bound to catapult them to the forefront of driving the next wave of economic growth," said Zhuo Fumin, chairman of Vstar Capital.

The 12th Global Innovation Index, soon to be published by researchers from INSEAD, Cornell University and the World Intellectual Property Organization, depicts China's continued progress as a global innovator.

Bruno Lanvin, executive director for Global Indices at INSEAD, said China broke into the top 20 of the index last year and the country continued to make progress in the area of quality innovation where it remains a strong leader among middle-income countries.

The combined revenue of Chinese companies accounted for 25.6 percent of the Fortune Global 500 list's total, behind the US at 28.8 percent.

The average profit of the 119 Chinese companies — not including those based in Taiwan — on this year's list stood at $3.5 billion, lower than the list's average of $4.3 billion. But it also improved from $3.1 billion for the 111 Chinese companies on last year's list.

"That is a fact to be expected. Chinese companies are relatively smaller in profitability but they are growing at a much faster pace," Jiang said.