Highlights
In the list of billionaires, Gautam Adani drops to fourth place after experiencing a one-day loss of Rs 28,599.
Adani Enterprises approached SBI for a 10,238 crore debt.
Adani Group Chairman Gautam Adani was the first person from Asia to make Bloomberg’s list of billionaires, but he has since slipped to the fourth position on the list of the world’s richest people. His net worth dropped by $3.51 billion (about Rs 28,599) on Thursday. Adani now has a net worth of $128 billion, placing him behind the Frenchman Bernard Arnault in the Bloomberg Billionaires Index.
On this list, Adani came in second place. But because of the stock market meltdown, his net worth has decreased by nearly $20 billion during the last few days. With $138 billion in wealth, Jeff Bezos of Amazon is ranked second on the list of the world’s wealthiest people, followed by Arnault ($129 billion). Elon Musk, the CEO of Tesla, comes in first place with a net worth of $240 billion. His net worth, which was $13.3 billion as of Thursday, experienced a significant $13 decline.
On Thursday, the shares of most listed companies of the Adani Group saw a sharp decline. The group’s flagship, Adani Enterprises, fell 2.17 per cent. Similarly, Adani transmission fell by 5.25%, Adani Total Gas by 1.28%, Adani Green Energy by 2.25% and Adani Ports by 1.37%. Adani Power and Adani Wilmar had marginal profit. Meanwhile, French company Total Energies says it can make a profit by selling a smaller stake in Adani Green Energy.
The Forbes billionaires list sees a closer fight between the three moguls for second place as there is a slight difference in the trio’s fortunes. The 73-year-old CEO of the fashion accessories brand is worth US$141.2 billion (11.54 lakh crore) against Bezos’ net worth of $141. 4 billion (₹11.56 lakh crore).
Adani, the richest Asian empire, saw its fortune down by $5.7 billion and has a net worth of $134.2 billion (Rs 10.97 lakh crore). The richest man in the world remains Tesla CEO Elon Musk, with a fortune of $263.2 billion (21.52 lakh crore). It had briefly held second place in recent days before being overtaken by Bezos and Arnault.
On the other hand, Mukesh Ambani, the CEO of Reliance Industries, the most valued corporation in the nation, is still listed as the 11th richest person in the world. A six-month low was reached by Reliance shares on Thursday during the trade. It decreased by 7% in one week. As a result of the crash on Thursday, Ambani’s net worth decreased by $169 million. Currently, he is valued at $80.3 billion. This year, his net worth has decreased by $9.65 billion.
Adani’s wealth loss can be attributed to stock market turmoil in India and abroad after the US Federal Reserve hiked interest rates to control inflation.
The 60-year-old business mogul has declared that his Adani Group will invest more than $100 billion over the following ten years, the majority of it in the energy transition industry. The firm has made investments in a number of industries, most prominently infrastructure.
The Adani Group has recently acquired the cement companies Ambuja Cements and ACC Limited and aims to become the largest cement manufacturer in the country. In addition, business conglomerate Adani Ports and Special Economic Zone Ltd was recently selected to develop the deep water port of Tajpur in West Bengal, Bloomberg reported.
The greenfield project will require a total investment of Rs 250 billion (US$3.1 billion), of which Rs 150 billion is for the development of the port, and the rest is for infrastructure construction.
Adani Enterprises Ltd, the flagship company of Adani Group, has secured Rs 10,238 crore in debt financing for the Ganga Highway projects from India’s largest public sector lender, the State Bank of India. On the one hand, Adani’s position in the list of the world’s richest has fallen from second to fourth place. On the other hand, Adani Group has been investing in and financing various projects. Recently, Adani companies approached SBI for a loan of Rs 10,238 crore to build India’s longest expressway linking Meerut with Prayagraj.
So Adani aims to provide India and UP state with much-needed excellent infrastructure but forgets that it is the same country where he is most indebted. He took out loans from various public banks, including SBI, and never even repaid them, becoming the top willful defaulter as he was able to repay the loan but choosing not to repay the amount.
Before being concerned about the country’s infrastructure, Adani and his group must be more concerned about the money they have taken from the banks in the form of loans and never repay them.
A study by CreditSights published recently classified the company as “severely over-indebted”, and in the worst-case scenario, it was prone to borrowing and defaulting. There are, though, escalating concerns about whether the growth will continue.
Over the last five years, the overall debt of the Adani Group has climbed from Rs. 1 trillion to Rs. 2.2 trillion. The majority of this debt was utilized to purchase industry-related properties and businesses, including significant infrastructure providers, ports, airports, and green energy. The move to diversify into the electricity and transmission industries led to a rise in the company’s debt.
The interesting thing is that while Adani’s Company owes 2.6 trillion, on the other hand, the big news is that India’s total reserve is only Rs 4.7 trillion. It just means that almost half of India’s reserve funds have gone to a company in the country, which is a suspicious situation. Well, the most worrying thing is that Adani’s entire business is based on debt. In order to invest in old projects and new projects, Adani Group is on a debt financing spree.
It’s not like companies around the world don’t borrow to run their business, but the most worrying thing is that the Adani group is continuously expanding. The big problem is that the company is constantly taking out loans for this, so the group is being affected day by day. The debt burden is increasing continuously.
Edited by Prakriti Arora
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