Mukesh Ambani, the richest Indian and head of market leader Reliance Industries Ltd, was not the leading wealth creator for small investors in 2007 but was pipped for the top spot by younger brother Anil.
A comparison of cumulative share price gains for the listed Companies from the two groups puts the surge for Mukesh Ambani group at 153 per cent, as against about 232 per cent for the Anil Dhirubhai Ambani Group (ADAG).
This is despite the Mukesh Ambani group recording an overall market capitalisation gain of close to Rs 3,00,000 crore, which is higher than ADAG's total market value.
Among the groups led by India's five richest, Mukesh Ambani group added Rs 2.99 trillion, Anil Ambani group added about Rs 1.66 trillion, K P Singh-led realty giant DLF saw a gain of about Rs 68,500 crore, Sunil Mittal-led Bharti Airtel added close to Rs 65,000 crore. On the other hand, Azim Premji-led Wipro lost about Rs 8,800 crore as it battled the adverse impact of the rising rupee against the US dollar.
The Mukesh group currently has a cumulative market cap of about Rs 5.05 trillion, as against Rs 2.91 trillion of ADAG group. Bharti Airtel, DLF and Wipro have a market cap of about Rs 1.84 trillion, Rs 1.65 trillion and Rs 78,178 crore respectively.
However, the Mukesh Ambani group is at the second spot after ADAG in terms of the collective share price gain for the Companies belonging to the individual groups. It was followed by DLF with a 85 per cent gain and Bharti Airtel with a surge of 55 per cent. Wipro lost 12 per cent.
Had one investor purchased one share each of the four listed Companies of Mukesh Ambani group -- RIL, Reliance Petroleum, RIIL and IPCL -- at the end of 2006, it would have cost a total of Rs 2,150.35.
As 2007 draws to a close, this portfolio has grown to Rs 5,437.91, after taking into account the allotment of one RIL share for five shares of IPCL that was delisted this year.
However, this gain of about 153 per cent is lower than 232 per cent surge in the cumulative share price of five ADAG firms.
In absolute terms also, one share each of Mukesh group Companies has given a return of Rs 3,287.56, as against a higher gain of Rs 4,768.15 from the five ADAG stocks and that also at a lower capital.
One share each of the five ADAG stocks – Reliance Communications, Reliance Capital, Reliance Energy, Reliance Natural Resources and Adlabs -- would have cost a total of Rs 2,053.30 at the end of 2006. This five-share portfolio is now worth Rs 6,821.45. If an equal capital, needed to purchase one share each of Mukesh group firms, was employed, the investor would have been rewarded with a return of Rs 4,993.52 – 52 per cent more than the gain from Mukesh group shares.
However, the gains from Mukesh group shares are higher than that of realty giant DLF, which rose 85 per cent over its IPO price of Rs 525 to the current price of Rs 971.65.
The two Ambani groups have also scored over Companies run by Sunil Mittal and Azim Premji, who complete the five-richest club owing their fortunes to Indian bourses. Bharti Airtel's share price has grown by 55 per cent in 2007, whie that of Wipro has actually dropped by 12 per cent.
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