Not surprisingly, India’s largest group by income, the House of Tatas, is the largest generator of wealth for shareholders. Its 28 listed entities together have added more than Rs 6 lakh crore of wealth for investors since January this year, a return of more than 40%. Next up is Reliance Industries (RIL) Group, controlled by Mukesh Ambani. Its nine publicly traded companies cumulatively added close to Rs 4 lakh crore of wealth for investors, a return of 28%. Bajaj is the third largest wealth creator for investors, followed by Adani, while Aditya Birla and L&T are side by side in fifth place (see chart).
“The tallest wealth creation It has come from the Tata Group and with good reason. Not only is its contribution amount the highest, but more importantly, it is the most diversified group and also has the largest shareholder base (85 lakh), providing a larger slice of the pie to public shareholders, ”said RippleWave Equity Advisors partner. Mehul Savla.
Seven of the top 10 business groups ranked according to their market capitalizations outperformed sensex.
Two of them, RIL and Mahindra, were broadly in line with sensex’s performance, while HDFC Group underperformed. Groups Hero (owned by Delhi-based Munjals), Indiabulls and Future (led by beleaguered Kishore Biyani) gave negative results. The sensex has returned 26% since January this year.
“The strong recovery of earnings after the first wave of Covid and a new rating of companies where valuations became attractive during crises have been the drivers of the increase in the market capitalization of the main business groups,” he said Sharekhan BNP Paribas head of research Sanjeev Hota. . “In addition, a global flow of liquidity and a new general rating of the shares have maintained buying interest in these companies through domestic and foreign institutional funds.”
On the other hand, Hota said: “Questionable corporate governance and weak earnings, along with a troubled balance sheet, were the factors that destroyed wealth in many companies.” Low-profile group CK Mehta, owner of Deepak Fertilizer and Deepak Nitrite, created the fastest wealth for shareholders, generating more than 150% return this year. On the other hand, Rajan Raheja Group created the slowest wealth for shareholders, generating only a 4% return.
With the sensex now topping 60,000 points, one group has also outperformed: the shareholders of Indian corporate houses.