India's Richest Lose 20% Of Their Total Wealth

Roiled by inflation, running at over 9%, and a spate of corruption scandals, Asia’s rising star has lost some of its sheen. Though India’s economy is still growing by 7.7%, its 100 richest have lost 20% of their total wealth: They are collectively worth $241 billion, down from $300 billion a year ago, due in part to a 10% decline in the Mumbai Sensex and a falling rupee.

For the fourth year in a row, Mukesh Ambani, whose Reliance Industries struck a lucrative $7.2 billion deal with BP (nyse: BP), holds the top spot with a net worth of $22.6 billion, despite losing $4.4 billion. At number 2, though $6.9 billion less well off than last year, is again steel magnate Lakshmi Mittal with $19.2 billion. Tech tycoon Azim Premji of Wipro (nyse: WIT) remains at No.3 even after donating shares worth $2 billion to his charitable trust which made him one of Asia’s top philanthropists.
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Then top 10 richest are collectively worth $113.6 billion, down from $150 billion last year. The biggest dollar loser was Mukesh’s brother Anil, worth $7.4 billion less than last year; he slipped out of the top 10 for the first time since his 2004 debut. While the value of his group companies fell, he was also hit by India’s telecom scandal relating to the granting of 2G licenses that landed three of his senior executives in jail.

Others ensnared in the scandal include real estate magnate Ramesh Chandra, who lost more than half of his fortune after his son Sanjay was arrested in April and shares of Unitech tanked. (He is one of 13 rich-listers who lost their billionaire status in the past year.) Among 15 who dropped out of the ranks altogether are Vinod Goenka and Shahid Balwa, former billionaires now in jail; both deny wrongdoing.

With New Delhi scrambling to contain the public protests against corrupt politicians and Congress Party President Sonia Gandhi going on a month-long medical leave, an ambitious build-out of the country’s infrastructure has virtually stalled. This year’s biggest loser in percentage terms is L. Madhusudan Rao of power producer Lanco Infratech; his net worth dropped 78%.

Only 19 of the 85 who returned to the ranks are better off. The biggest gainer in percentage terms is motorcycle king Brijmohan Lall Munjal, who broke off a 26-year pairing with Honda Motors, buying out its stake at nearly half the market price. Dilip Shanghvi whose Sun Pharmaceuticals is India’s most valuable pharma firm, added $1.5 billion to his wealth, the biggest gain in dollar terms.

Among the 14 newcomers is M.G. George Muthoot who built a business around the craze for gold among middle-class Indians. His Muthoot Finance, which he listed this year, gives loans against gold and jewelry. Another entrant is V. G.Siddhartha, who founded and runs Café Coffee Day, a 1,200-store chain that’s India’s answer to Starbucks. Father/son duo Kapil and Rahul Bhatia of InterGlobe Enterprises make their debut after their budget carrier IndiGo gained altitude to become India’s third-largest and most profitable airline.

A fortune of $370 million was needed to make the cut, down from $500 million a year ago. The net worths are a snapshot of wealth based on share prices and exchange rates on Oct. 12. Privately held companies were valued by comparing them with similar publicly traded companies. This ranking, unlike the FORBES World’s Billionaires list, has been broadened to include family fortunes such as those of Anand Burman and Murali Divi, who are here listed as billionaires but won’t qualify for the worldwide rankings published in March.