Gautam Adani becomes third-richest in the world. All you want to know

Gautam Adani

Indian Market
by 5paisa Research Team Last Updated: Dec 13, 2022 - 09:53 am 17k Views

The world, it appears, cannot get enough of Indian billionaire Gautam Adani. 

The Gujarati businessman, who is said to be close to Prime Minister Narendra Modi, is now the first Asian to become the third richest person in the world. 

The Bloomberg Billionaires Index has ranked Adani the third-richest person in the world, something neither Reliance chairman Mukesh Ambani nor Alibaba founder Jack Ma could achieve. 

So, how wealthy is Gautam Adani?

He is now worth an estimated $137.4 billion with only Elon Musk and Jeff Bezos ahead of him. 

Interesting, so where does he get most of his wealth from?

Bloomberg says that Adani, 60, has spent the past few years expanding his coal-to-ports conglomerate, venturing into everything from data centers to cement, media and alumina. The group now owns India’s largest private-sector port and airport operator, city-gas distributor and coal miner. While its Carmichael mine in Australia has been criticized by environmentalists, it pledged in November to invest $70 billion in green energy to become the world’s largest renewable-energy producer.

The pivot to green energy and infrastructure has won investments from firms including Warburg Pincus and TotalEnergies SE, helping Adani enter the echelons previously dominated by US tech moguls. The surge in coal in recent months has further turbocharged his ascent.

All told, Adani has added $60.9 billion to his fortune in 2022 alone, five times more than anyone else. He first overtook Ambani as the richest Asian in February, became a centi-billionaire in April and surpassed Microsoft Corp.’s Bill Gates as the world’s fourth-richest person last month.

But are there any concerns about the meteoric rise in his wealth?

Not so much about the rise in his wealth but about the rise in the indebtedness of his business empire. 

Worries are growing over the exponential growth. Adani’s dealmaking spree has been predominantly funded with debt and his empire is “deeply over-leveraged,” CreditSights said in a report last week. In the worst-case scenario, that could lead to a default, the Fitch Group unit warned.

Some lawmakers and market watchers have also raised concerns over opaque shareholder structures and a lack of analyst coverage at Adani Group companies. Yet the shares have soared -- some of them more than 1,000% since 2020, with valuations hitting 750 times earnings -- as the tycoon focused on areas that Prime Minister Narendra Modi deems crucial to meeting India’s long-term goals.

But how has Adani managed to get past some of the wealthiest US-based billionaires? 

Adani was able to move past some of the world’s richest US billionaires partly because they’ve recently boosted their philanthropy. Gates said in July he was transferring $20 billion to the Bill & Melinda Gates Foundation, while Warren Buffett has already donated more than $35 billion to the charity.

The two, along with Gates’s ex-wife Melinda French Gates, started the Giving Pledge initiative in 2010, vowing to give away most of their fortunes in their lifetimes.

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