Adani Vs Ambani: What helped Mukesh Ambani regain richest status in India

Reliance Industries (RIL) chairman Mukesh Ambani once again managed to become the richest individual in the country, replacing Gautam Adani amid the recent erosion in the market capitalisation of select Adani Group of companies.

Data available with Ace Equity showed that the cumulative market capitalisation of Adani Group of companies declined by Rs 2.47 lakh crore to Rs 13.95 lakh crore on June 6, 2022, from Rs 16.42 lakh crore on May 6, 2022. On the other hand, the market valuation of Reliance Industries inched higher by 0.98 lakh crore to Rs 18.72 lakh crore during the same period.

With a fall of 37 per cent, shares of Adani Green Energy declined the most in the last month among the seven listed Adani Group of companies. It was followed by Adani Transmission (down 29 per cent), Adani Ports and Special Economic Zone (down 8.50 per cent) and Adani Enterprises (down 0.99 per cent). On the other hand, Adani Total Gas, Adani Power and Adani Wilmar gained 1.73 per cent, 2.30 per cent and 4.87 per cent, respectively, since May 6, 2022.

Independent analyst Ambareesh Baliga said, "Adani Group stocks are high beta so it's quite natural that they will underperform when the market enters a correction phase. Whereas for RIL, the blended refining margins are expected to improve with Russian oil imports, petchem margins expected to hold up, retail and telecom are firing from all cylinders and the market is also upbeat on their new initiatives. Thus, RIL currently seems to be supporting the headline index."

On the other hand, other market watchers believe that some of the Adani Group stocks took a hit due to profit booking and changes in the composition of the MSCI India Index. 

Independent market analyst Ajay Bodke told Business Today that the sharp flare-up in refining margins globally including Singapore gross refining margins (GRMs) over the past few weeks has led to an expectation that the standalone refiners will be prime beneficiaries of the rise in margins. “For the current quarter, MRPL, Chennai Petroleum and RIL will be the biggest beneficiaries. However, ongoing under-recoveries in petrol and diesel will continue to hurt oil marketing companies,” Bodke said adding a recent reshuffle in the MSCI index that happened a week back led to selling by passive funds in select Adani Group of stocks.

According to Forbes real-time billionaire list, Ambani is the sixth richest in the world with an overall net worth of $103.20 billion. On the other hand, Gautam Adani is the seventh richest with Rs 101.1 billion of net worth.

Kranthi Bathini, Equity Strategist, WealthMills Securities said, “Gross refining margins are very high due to high oil prices across the globe and RIL is the key beneficiary of soaring oil prices. Coming to Adani, the group stocks ran ahead of valuation in the last few months. So, I think some profit booking and consolidation are happening as far as Adani Group of stocks are concerned.”