India's richest men drop out of world’s elite $100 billion club
Both Mukesh Ambani, chairman of conglomerate Reliance Industries Ltd, and fellow tycoon Gautam Adani, founder of the Adani Group, are now facing multiple threats that are hitting their businesses — and their immense personal wealth
The wedding celebration of Indian billionaire Mukesh Ambani's son Anant earlier this year was the stuff of tabloid fantasy: a seven-month extravaganza that saw Rihanna and Justin Bieber flown in to entertain guests across exotic locales from Mumbai to the Italian Riviera.
The event — which cost $600 million by some estimates — offered a window into the supreme confidence of the country's super wealthy, buoyed by soaring fortunes, a fast growing economy and demand for Indian assets. Fast forward six months, though, and the outlook suddenly looks less rosy.
Both Mukesh Ambani, chairman of conglomerate Reliance Industries Ltd, and fellow tycoon Gautam Adani, founder of the Adani Group, are now facing multiple threats that are hitting their businesses — and their immense personal wealth.
Ambani's energy and retail businesses have been underperforming amid rising investor concern about debt, while Adani's empire was rocked by a US Department of Justice probe that threatens to squeeze funding and make it harder to win contracts. And it's still not clear if the worst is over for either.
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For Adani, the move by US prosecutors in November over alleged bribery was an unwelcome return to the international media spotlight. He's been fighting to shore up investor confidence after short seller Hindenburg Research last year published a report accusing the firm of fraudulent practices.
Adani, who has denied both charges, has vowed to fight on. He said at an event after the US allegations that the firm is committed to "world-class regulatory compliance" and that each attack against the company "only makes us stronger."
The charges are likely to weigh on the group — and its share price — heading into the new year. Adani's fortune peaked at $122.3 billion in June after he'd worked to bolster finances following Hindenburg's attack. Those gains have now evaporated after the US allegations that he oversaw bribes to Indian government officials, and he's now worth $82.1 billion, according to the Bloomberg Billionaires Index.
He's not alone in seeing billions of his personal fortune melt away recently. The wealth of Ambani, Asia's richest man, has also taken a tumble, if perhaps in a less dramatic and public way. It peaked at about $120.8 billion in July, right at the time the opulent family wedding was in full swing.
His flagship Reliance conglomerate has struggled with weakening earnings at the energy business to flagging consumer demand at the retail division. His fortune stood at $96.7 billion as of December 13.
Both Ambani and Adani have tumbled out of the elite centibillionaires club - people with fortunes above $100 billion, according to the Bloomberg Billionaires Index.
Ambani is counting on a strategic shift that has seen his conglomerate focus more on digital platforms, retail brands, and renewable energy to lift growth. But sales and profit growth have slowed at the retail business, while digital rivals have gained a footfall in the grocery and household item market, especially in India's top cities.
Musk's Starlink
The potential entry of Elon Musk's Starlink in India's satellite broadband market could also threaten gains at his digital and telecom business, Jio Platforms Ltd. The oil-to-chemicals business is under pressure from waning demand and Chinese exports.
"Reliance remains a strong wealth creator and each business has great value. But the pressure on the oil business has caused the stock to under perform," said Kranthi Bathini, equity market strategist at Mumbai-based WealthMills Securities Pvt.
But Reliance has large ambitions in the tech space through a joint-venture deal with Walt Disney Co., which will create an $8.5 billion media behemoth that is expected to dominate India's streaming market. It also expanded its partnership with Nvidia Corp., with plans to build out artificial intelligence computing infrastructure in India.
Further afield, both men also face other headwinds in common going into the new year, particularly the risks after the election of Donald Trump and uncertainty around the outlook for Indian business.
"In the short term there are challenges, especially with Trump imposing tariffs that's going to make India's exports not that competitive," said V.K. Unni, a professor at the Indian Institute of Management Calcutta.
Billionaire retailer Radhakishan Damani has also lost significant wealth this year, as his DMart chain grapples with low footfall at new stores and online competition. He's now worth $17.1 billion, down from a peak of $27.8 billion in October 2021.
But to be sure, the fortunes of most of the richest Indians continue to grow: the twenty wealthiest have added $67.3 billion since the start of the year, according to Bloomberg's wealth index. The biggest gainers — technology tycoon Shiv Nadar and Savitri Jindal, whose family controls industrial conglomerate Jindal Group — have added $10.8 billion and $10.1 billion respectively.
"We will see founders focusing on making their companies more efficient given the level of uncertainty in the world," said Shrikant Chouhan, head of equity research at Kotak Securities.
