SAP has overtaken Danish drugmaker Novo Nordisk to become Europe’s most valuable listed company, marking a major milestone for the German software group and a shift in investor sentiment from pharma to tech.
SAP’s market capitalisation rose to around €314bn on Monday 24 March, edging ahead of Novo Nordisk at €310bn. The two companies have been trading places near the top of Europe’s market rankings for months, but the latest move underscores the strength of SAP’s year-long rally—driven by investor confidence in cloud computing, artificial intelligence, and a broader appetite for European tech.
Shares in SAP have risen more than 40% over the past year, fuelled by optimism about its transformation into a cloud-first company. The firm has steadily shifted its enterprise resource planning (ERP) software business from on-premises licences to cloud-based subscriptions, while layering on AI features to appeal to new and existing customers.
In contrast, Novo Nordisk—briefly Europe’s most valuable company at the height of weight-loss drug mania—has seen its valuation slip by almost half since mid-2024. The Danish pharmaceutical group had surged on soaring demand for GLP-1 drugs such as Ozempic and Wegovy, but shares have pulled back amid concerns about future growth. Trial results for its next-generation therapy, CagriSema, failed to excite investors, and rising competition in the obesity drug market has contributed to a broader reassessment of the company’s prospects.
SAP’s climb also reflects deeper changes in the structure of European markets. The company now accounts for more of Germany’s DAX index than any other stock, occasionally breaching the 15% weighting cap set by Deutsche Börse. That dominance has sparked comparisons to industrial gas firm Linde, which quit the DAX in 2023 and shifted its primary listing to New York to avoid index constraints and access deeper capital markets.
In recent years, the DAX has adjusted its rules to retain heavyweight constituents like SAP, but the concentration issue remains. SAP’s prominence now exceeds that of German industrial icons such as Volkswagen, Siemens and Mercedes-Benz—illustrating how the centre of gravity in Europe’s largest economy is tilting away from manufacturing toward enterprise software and data services.
Meanwhile, Novo Nordisk’s slide has reshuffled Europe’s corporate leaderboard once again. French luxury group LVMH currently ranks third by market cap, followed by Dutch semiconductor equipment maker ASML, which had itself been Europe’s top tech firm before being overtaken by SAP last October. ASML’s market value fell sharply late last year after it warned of slower-than-expected orders from chipmakers, although its shares have since rebounded.
