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BW Businessworld

A Good Year For The Super Rich

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The last financial year saw the Indian economy slow to a crawl, and it was terrible for employees across the board. But as our latest Super Rich survey shows, it was not a very bad year for Indian billionaires. Between 1 April 2013 and 31 March 2014, the BSE Sensex shot up 18.67 per cent, while the NSE Nifty rose 17.5 per cent. Many of the billionaires saw their net worth rise faster than both indices. The stock market boom also created a record number of new billionaires. This year could be even better — since April this year, both indices have risen 12 per cent or so. In fact, the ranks of dollar billionaires swelled, even though the rupee-dollar rate had moved from Rs 55 to a dollar in April 2013 to Rs 60 to a dollar by end March 2014.

The year also saw a few entrepreneurs sell their companies and walk away with a lot of cash. On the other hand, many billionaires who operated in real estate and infrastructure or owned companies whose projects had been hit by environmental or other clearances saw their wealth drop. In general though, many of the super rich saw their wealth increase far in excess of the improvement in the results of their companies. To an extent, this was because the markets had grown barely 6 per cent in the previous year (2012-13) but moved up sharply in the second half of the last financial year.

A small explanation here: the BW | Businessworld study calculates wealth by tracking the value of the shares held by promoters of listed companies. While this accurately measures the worth of businessmen who have listed most of their companies, it cannot always gauge the true wealth of people who have large unlisted companies. Thus, we could not rank people like Cyrus Poonawalla, B. Ravi Pillai or Yusuffali M.A. as they have kept their companies private.
The Super Rich study this year was handled by senior assistant editor Shailesh Menon, senior editors Nevin John and P.B. Jayakumar and special correspondent  Sachin Dave. The results of the study are on page 42. Assistant editor Abraham C. Mathews helped in the study.

What will this year be? So far, the markets have risen sharply because of expectations that the Modi government will herald a new era of development and rapid growth. Many market watchers are predicting a multi-year bull run. Can anything trip it up? A poor monsoon, an inability to control food inflation and slippages in fiscal discipline could. That brings us to the question: what can the Modi government do to maintain fiscal discipline while boosting growth? We posed the question to several economists and businessmen. Their answers are on page 34.

(This story was published in BW | Businessworld Issue Dated 14-07-2014)