Billionaire Gautam Adani-led Adani Group has become India's second-largest conglomerate after Tatas in terms of total market capitalisation of group companies, pushing Mukesh Ambani’s energy-to-telecom conglomerate Reliance Industries to the third position. Homegrown Adani Group, a ports-to-energy conglomerate with six publicly listed companies in India, has a total market capitalisation of ₹19.73 lakh crore, the second highest after software-to-steel conglomerate Tatas' ₹22.05 lakh crore as of August 22, 2022. In comparison, the market valuation of Reliance Industries group stands at ₹17.63 lakh crore.

Established in 1988 as a commodity trading business by Gautam Adani, the group has expanded rapidly across key business verticals such as energy, utilities, and transportation by listing seven entities, namely Adani Enterprises (AEL), Adani Green Energy (AGEL), Adani Ports and Special Economic Zone (APSEZ), Adani Power, Adani Total Gas, Adani Wilmar, and Adani Transmission.

The sharp rise in valuation of Adani group can be attributed to the recent rally in the share price of Adani Group companies, which zoomed up to 300% so far in 2022, led by Adani Power and Adani Wilmar. Within the Adani group, Adani Power outshined the peer companies in terms of return in the calendar year 2022. The power and energy arm of the Adani group delivered 305% returns to its shareholders on a year-to-date (YTD) basis, followed by Adani Wilmar, the edible oil arm of Adani, which rose 156% in the current year.

The Adani group’s flagship Adani Transmission rose 95% in the current year, followed by Adani Total Gas (90%), Adani Green Energy (76%), Adani Enterprises (72%), and Adani Ports and Special Economic Zone (10%).

Meanwhile, Asia’s richest man Gautam Adani, founder and chairman of the Adani group, has entered the $100 billion club on the back of a strong surge in his net worth. With a net worth of $134.4 billion, he is the only Indian to appear on Forbes’ Top-10 Billionaire list. The 60-year-old business tycoon has recently surpassed Google’s famed founders Larry Page and Sergey Brin driven by a rise in value of his holdings in the Adani Group stocks, which have jumped significantly in recent years.

According to a recent report by global research firm CreditSights, competitive rivalry between Adani Group and Reliance Industries for market share in a few new economy businesses (such as renewable power, telecom), it could lead to “some imprudent financial decisions from both sides, such as higher capex spends, aggressive bidding, and overleveraging”. While Adani entered the renewable generation business through Adani Green Energy (AGEL) in 2015, RIL too announced its foray into the sector in October 2021, and plans to become one of the largest players in the sector with a 100 GW capacity within this decade. On the flip side, RIL made its entry into the telecom sector first with Reliance Jio in 2015, ousting several incumbents and becoming one the of leading players since, while Adani followed into the telecom business by successfully bidding for spectrum in India’s recently-held 5G auctions. Currently, Adani plans to use the 5G airwaves only to provide 5G enterprise network solutions (B2B) for private use and enhance its group-wide cyber security, clarifying that it was not looking to enter the commercial consumer telecom business.

“RIL has been on a deleveraging trend over the past few years, and boasts robust credit metrics (gross and net leverage at 2.6x and 2.2x as at end-FY22) and interest cover (7.8x at FY22). On the other hand, Adani has elevated leverage and poor interest cover and cash outflows across virtually all its entities, and is at greater financial risk,” CreditSights said in a report dated August 23, 2022.

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