IT'S NOT WITHOUT reason that the 18th century is referred to as the period of Scottish Enlightenment. It was during this era that prominent personalities Adam Smith (economics), David Hume (philosophy), Robert Burns (literature), and James Watt (engineering and science) made ground-breaking contributions in their respective fields. But, arguably, it's Smith's legacy in the field of economics that has been enduring. In his quiver of seminal works, An Inquiry into the Nature and Causes of the Wealth of Nations is an opus that still reverberates in modern economics, especially Smith's free market theory. The core argument of The Wealth of Nations posits that when individuals act in self-interest, it, inadvertently, leads to collective societal gains. In this framework, the division of labour within an economy creates a network of interdependencies which, facilitated by market forces, contribute to overall stability and wealth creation.

Undeniably, Smith's theory is underway in the most populous country — one that aspires to be the world's third-largest economy.

Savour this. The second edition of the Fortune India-Waterfield Advisors' study of India's richest — a definitive listing of the country's dollar billionaires — shows that the elite club is now equivalent to 25.39% of India's FY23 GDP of ₹273 lakh crore ($3.4 trillion). The collective wealth of India's uber rich swelled from ₹66.35 lakh crore ($832 billion) in 2022 to ₹69.30 lakh crore ($843 billion) this year, even as the club of billionaires expanded from 142 to 157. India's prosperity engine is not just running — it's roaring.

What's important to note is that this performance occurs amid a 2.95% decline in the rupee against the dollar, offset by a 10% gain in the benchmark indices since last year. Given that equity holdings in listed and unlisted companies are the biggest source of wealth creation, the expanding multiples on the back of improved earnings have only added sheen to the overall numbers. The top 13 names, whose net worth is more than ₹1 lakh crore, control around 47.70% (₹33.01 lakh crore/$438 billion) of the cumulative wealth held by the 157 billionaires.

Drawing parallels with China's growth story, Manoj Shenoy, MD & CEO of Bengaluru-based o3 Wealth & Asset Management, which manages over $2 billion in assets, says that when China's GDP per capita in 2002 was about $1,100, they had about 188 billionaires. "After 20 years, their GDP per capita ballooned by about 11 times to $12,270, and the billionaires jumped by 6.6 times to about 1,234. A very similar jump is evident in India. From 2002, even as the per capita GDP rose 5x from $469 to $2,389, the number of billionaires surged 15x," says Shenoy.

The Continuous Constant

What makes this year's list interesting is the entry of 23 debutants, of which there are entrepreneurs of 14 listed entities and nine unlisted companies, collectively worth ₹2.79 lakh crore. While Ashwin Desai (₹11,654 crore) of Aether Industries and Prem Kumar Arora (₹15,610 crore) of Mankind Pharmaceuticals made their debut on the back of their recent listings, the 12 entrepreneurs came on the back of robust performance in their share prices with the likes of Surendra Kumar Arya (JBM Auto), T.S. Kalyanaraman (Kalyan Jewellers), Anand Deshpande (Persistent Systems), Sanjay Gupta (APL Apollo Tubes) and Sunil Vachani (Dixon Technologies) breaking into the ₹10,000 crore club. Among the billionaires running unlisted businesses, the most prominent one to enter the list is 92-year-old Lachhman Das Mittal of International Tractors with a value of ₹25,123 crore, followed by three jewellers, Joy Alukkas, Rajendran Govindarajulu (GRT Jewellers) and Savji Dholakia (Hari Krishna Exports). The others from the unlisted space came from businesses as diverse as earthmoving equipment, pharmaceuticals, sanitaryware fittings, infrastructure, and cement.

Even as the newbies are making their mark, it's the incumbents who have raked in the big moolah this year.

In terms of absolute wealth change (listed and unlisted), Cyrus Soli Poonawalla leads the chart of gainers with his overall wealth increasing by over ₹1.08 lakh crore. Barring the financial services play which accounts for 6.5% of the total value, the exponential growth is driven by the valuation of the company's cash cow, Serum Institute of India. The Poonawalla Group flagship's profit rose almost three times to ₹11,116 crore in FY22 as revenues more than trebled to ₹25,645 crore, with its Covishield vaccine cornering 79% share (174.52 crore doses) of the total 220.07 crore doses administered in the country through the course of the pandemic. However, the No. 1 gainer on the list — among owners of listed businesses — is none other than Mukesh Ambani, who decisively regained the top spot at ₹8.19 lakh crore, riding on the back of over ₹65,000 crore in absolute gains. Among the top five gainers, after Ambani, is Savitri Devi Jindal (₹1.36 lakh crore) and Shiv Nadar (₹1.89 lakh crore), though Nadar's absolute gain is less than half of what Ambani managed to achieve, followed by Sunil Mittal and family, Ravi Kant Jaipuria, Dilip Shanghvi & family and Mangal Prabhat Lodha.

Of those whose wealth reduced, Falguni Nayar saw close to ₹14,000 crore decline in her net worth, followed by Azim Premji and Uday Kotak. Among those who fell off the list of dollar billionaires were eight names, of which two billionaires who couldn't make the cut because of the rupee cut-off of 82.17 were Radhe Shyam Agarwal of Emami and Rahul Gautam of Sheela Foam, while five billionaires fell off the list as the cumulative value of their holdings plummeted (-30%) from ₹50,693 crore in 2022 to ₹37,277 crore this year. The biggest fall was seen in the wealth of the Gogri family from ₹12,935 crore in 2022 to ₹7,940 crore, following the more than 50% decline in Aarti Industries stock from ₹900 levels to ₹449. The meltdown comes amid concerns of limited earnings, given Aarti's dependence on discretionary end-use industries such as agrochem, pharma, and dyes-pigments, amid rising competition from Chinese players. The only exception from the list of exits is R. Thyagarajan, the pioneer of commercial vehicle credit, who in December 2021 relinquished his holding in Shriram Group, in favour of the Shriram Ownership Trust, and hence was not ranked in this year's list. The perpetual trust has 44 group executives as beneficiaries.

Of Patriarchy & Legacies

In a largely male-dominated list, there were just 11 women, with a cumulative wealth of ₹3.81 lakh crore ($46.41 billion). Topping the list is 73-year-old Savitri Jindal, chairperson of the Jindal conglomerate, whose four main businesses; steel, power, mining, oil & gas, are independently managed by her four sons, Prithviraj, Sajjan, Ratan, and Naveen. Of the ₹1.36 lakh crore, Sajjan Jindal's business, JSW Group, is the single biggest contributor (₹50,000 crore) to the collective net worth. In fact, over the past one year, Savitri Jindal's net worth surged ₹42,633 crore, fuelled by the boom in commodity prices. The $22 billion JSW Group has kicked off a ₹85,000 crore debt-laden capex cycle that will last till March 2025. "The group will add a minimum of two-three businesses by 2030," Sajjan Jindal had told Fortune India in a recent interaction.

The daughter of the late Abhay Arvind Vakil, co-founder of Asian Paints, and other members of the Vakil clan collectively own over ₹50,000 crore in the paints major. Rekha Jhunjhunwala, wife of the late Rakesh Jhunjhunwala, is the third-richest woman in the list as the Big Bull's portfolio value increased by over 32% to over ₹46,000 crore. Following the meltdown in Nykaa's share price, Falguni Nayar is now ranked fifth with the fourth place going to Leena Tewari of unlisted drug company USV. Biocon's Kiran Mazumdar-Shaw (₹19,575 crore) is bullish about biosimilars, whose market is expected to compound at 24.7% from $11.8 billion in 2020 to $35.7 billion by 2025. "We are very confident that our performance in the U.S. and other markets is showing good growth, and we expect that to translate into both revenue and bottomline growth," Shaw tells analysts in the recent earnings call. The company, whose consolidated revenues rose 38% year-on-year to ₹11,550 crore in FY23, is now ranked among top 10 biosimilar manufacturers globally.

What's pertinent to note is that India's legacy business houses, the Tatas, the Bajajs, the Birlas, and the Burmans, stand tall in a listing peppered with first- and second-gen entrepreneurs. Barring the Mistry family whose wealth is largely tied in the privately held Tata Sons, the Godrej clan (₹1.57 lakh crore), the Bajaj family (₹1.42 lakh crore), Kumar Mangalam Birla (₹1.42 lakh crore) and the Burmans (₹82,352 crore) continue to rank among the 20 top richest Indians. Soumya Rajan, founder and CEO, Waterfield Advisors, whose firm is wealth advisor to over 200 business families, believes it is not without reason. "What has been unique about family businesses in India is that a lot many have managed to prove their resilience and adapt with the times. If the early era was about professionalising the management, today, the families are ensuring that the legacy is preserved down the generations by creating the right governance structures to prevent conflicts."

Winds of Change

From a sectoral perspective, it's not surprising to see business families running diversified businesses generate ₹26.45 lakh crore ($322 billion) in collective wealth, though lower than last year thanks to the market meltdown of the Adani Group. Pharmaceuticals is the second-biggest sector where 22 billionaires have churned out ₹10.28 lakh crore ($125.13 billion). Fast-moving consumer goods (FMCG) is the third-biggest sector where 13 billionaires hold a cumulative ₹5.20 lakh crore ($63.30 billion). Given the sticky inflation and rate hike spree, the U.S. market is facing a challenge in terms of growth and that has taken the wind off the IT services sector. But for now, the sector continues to boast of eight billionaires worth ₹4.57 lakh crore, with Shiv Nadar and Azim Premji accounting for ₹3.53 lakh crore, or 77% of the sectoral net worth. Once seen as a recession- proof industry, the reversal of the four decade long low-rate environment in the U.S is now proving to be a spoiler in the India IT story. The pandemic-fuelled digital boom saw the cumulative market cap of 56-stock BSE IT Index more than double from ₹16 lakh crore in 2020 to a high of ₹39 lakh crore in 2022. But since then, concerns around the fallout of the Fed rate hike on IT spending of companies has pulled down the mcap by 20% to ₹31 lakh crore.

"Whether there would be an encore from this sector is anyone's guess. But I wouldn't be surprised if this sector continues to dominate as they are best positioned to take advantage of any incremental economic value from artificial intelligence and machine learning," says Shenoy of o3 Wealth, which also manages the wealth of a couple of Infosys co-founders.

Interestingly, of the two professionals-turned-entrepreneurs, Falguni Nayar (Nykaa) and Abhay Soi (Max Healthcare Institute), the latter has increased his wealth by more than 56% to ₹13,869 crore, while Nayar's wealth saw a 38% decrease. Soi turned a promoter along with private equity major KKR in the formerly Analjit Singh-owned entity, following the demerger of Radiant Life & Max Healthcare and Max India assets. The 3,500-bed hospital chain is now looking to ramp up the business, which clocked revenues of ₹5,092 crore in FY23. "There are 21 cities that we have identified. These are cities where at least one or two of our peers have proven viability. So, we think we can go there and do it better," Soi tells analysts post Q1FY24.

In fact, the 49-year-old Soi happens to be the youngest entrepreneur from Mumbai to make it to the list. Unsurprisingly, dollar billionaires are largely concentrated in two cities. Mumbai and Delhi together account for ₹41.56 lakh crore (60%) of the Fortune India-Waterfield Advisors listing, followed by Bengaluru, Chennai and Ahmedabad. Interestingly, there are 18 smaller towns and cities that have a dollar billionaire each.

Within the start-up universe concentrated in Bengaluru, barring Byju Raveendran, whose wealth has seen a drastic 73% fall to ₹10,980 crore following the controversy around his edtech empire, the Kamath brothers of Zerodha and Bhavish Aggarwal of Ola are sitting pretty. In fact, even as the cab-sharing business is losing steam, Aggarwal is riding the EV wave with Ola Electric emerging as the country's largest electric two-wheeler maker.

While the funding winter and subsequent valuation meltdown could upend the start-up saga, going by recent trends in India Inc., it appears that diversified conglomerates — more specifically, the Tatas, Reliance Industries and Adani — are setting their sights on increasing their influence through a series of mergers, acquisitions, and spin-offs, all underpinned by a strong digital strategy. "Post deleveraging and institutionalising cost efficiency, the bigger have become much stronger. Hence, the theme will play out across sectors," says Rajan of Waterfield Advisors.

With an average age of 60-plus, the Fortune India-Waterfield wealth ranking might seem like a senior yearbook, reinforcing the idea that wealth often keeps better company with experience. But in a nation brimming with youthful exuberance, a demographic plot twist is in the offing. As next-gen heirs take on the reins of their legacy empires and start-up founders face baptism by fire on the Street, the unfolding years could well rewrite the names that adorn the list.

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