Interestingly, as the new richest man in Asia and the third richest man in the world, Adani's biggest identity label is actually a "coal boss", which adds some legend to his wealth story.
Text | Financial Gossip Female Special Author: Old Uncle
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The iron fortune list, the rich man of the flowing water.
After two consecutive years of being Asia's richest man, Nongfu Spring Chairman Zhong Shui's position was challenged by an Indian. And this seemingly unknown character, as soon as he appeared, was a "king fried" posture.
On August 30, according to the data of Bloomberg's global real-time rich list, India's rich man Gortam Adani not only became the new richest man in Asia with a net worth of $137 billion, but also broke into the top three of the world's richest people, becoming the first Asian to come to this position, ranking second only to Tesla's Musk and Amazon's Bezos.
According to the property index released on March 15, Adani's wealth value is equivalent to 5 Ma Yun (Ma Yun's total net assets are 27.9 billion US dollars).
Interestingly, as the new richest man in Asia and the third richest man in the world, Adani's biggest identity label is actually a "coal boss", which adds some legend to his wealth story.
What exactly is Adani? How did he create so much wealth?
1.
/ Two hundred billion dollars soared in two years,
"Fastest Ever" New Richest Man /
According to the latest Bloomberg regal statistics, Adani's net worth of $137 billion is not much distance from Bezos's $153 billion, and they can be called hand in hand under Musk.
No way, "Iron Man live-action version" Musk is really too good to fight.
Compared with Bezos's posture of being the world's richest man for many years, the emergence of India's richest man Adani is obviously more shocking. Because before this, Adani did not say that he appeared on the global rich list, and his performance in the Indian rich list could not be considered outstanding.
▲The picture shows the Bloomberg Global Real-time Rich List
In the past two years, Adani's wealth has grown too fast, which is very eye-catching in the context of the global economic downturn.
So far this year, among the world's top ten richest people, only Adani has achieved positive growth in value. Adani's wealth has grown by $60.9 billion so far in 2022, a statistic that has given him the current title of "the world's fastest-growing richest man."
In the past 2021, Adani's wealth growth is also very "fast".
Last year, Adani's total wealth grew by $42.7 billion, ranking first in India and fifth in the world. At the beginning of this year, Adani surpassed the veteran Indian tycoon Mukesh to become the richest man in India and the richest man in Asia; In April, Adani's total wealth exceeded 100 billion US dollars; In July, Adani surpassed Bill Gates in net worth to leap to fourth in the world; In August, it continued to climb to the third place in the world...
As of August 30, 2022, the total market capitalization of Adani Group exceeded US$251.51 billion.
The fastest increase in wealth in history has allowed Adani's wealth empire to begin to be exposed in the spotlight.
Looking back at Adani's entrepreneurial journey, around 2000, he was just a small business owner in India. By 2020, his net worth is less than $8 billion, which is not enough to see in front of a group of hundreds of billions of dollars.
In just two years, he achieved a counterattack, what happened in between?
I have to say that sometimes wealth soars, in addition to hard work, it really needs a little luck.
Adani's net worth jumped from billions of dollars to the level of 100 billion US dollars, which is closely related to changes in the economic environment. During this period, the stock price of Adani's companies rose by a hundredfold, and considering that most of the countries and large enterprises were facing shrinking wealth during this period, the industry areas that Adani Wealth Empire focused on were quite important.
As a "coal boss", Adani's recent rapid rise in wealth is inseparable from his layout in the coal field and his achievements in coal sales.
It is reported that the Adani Group occupies more than one-third of india's coal import business, and in the international environment of the Russian-Ukrainian conflict, global coal demand and coal prices have ushered in a sharp rise, which has made the Adani Group earn a lot of money. Notably, Adani group also owns a coal mine with estimated reserves of 27 billion tonnes, which is also the largest coal mine in Australia.
In addition, the Indian market is already one of the world's top two coal consumers, its coal consumption is mainly used for power generation, coupled with india's widespread extreme heat weather since April this year, the local market demand for coal surge, which also contributed to the Adani Group's performance soared.
Of course, Adani's wealth did not stop at coal mines. With rapid expansion and capital acquisitions over the years, Adani Group has become a behemoth with operations spanning energy, ports and logistics, mining and resources, natural gas, defense and aerospace, and airports, with seven public companies with a combined market capitalization of more than $250 billion.
At present, Adani Group is India's largest private port, airport, city gas distributor and coal mining operator, and has also invested heavily in and expanded in many fields such as data centers, cement, alumina, and green energy.
It can be seen that the strong monopoly attribute of resources has allowed Adani to usher in a wealth explosion at a special point in time when the value of energy and resources is highlighted.
2.
/ The mysterious history of the "little people"
His story cannot be copied/
In the eyes of the outside world, Adani's wealth growth process is only the history of a small person's fortune, but considering the expansion process of Adani Group, it makes Adani's entire entrepreneurial journey appear mysterious.
Unlike many rich people with golden spoons, the newly richest man, Adani, did not start well.
He was born in 1962 in Cheva, a remote tribe in India, to a family of eight siblings who depended entirely on their parents' textile business.
In India, where caste rankings are popular, Adani's family is not even considered the lowest caste, Shudra, but is seen as a "barbarian" from the Cheva tribe. He's a Dalit, yes, the lowest-caste Dalit in India who has lived the worst in the Chinese Internet world.
According to the data, in the second year of university, in order to subsidize the family, 18-year-old Adani dropped out of Gujarat University and went to Mumbai to work as a diamond sorter. In just 1 year, Adani earned his first 1 million. In 1988, when he was 26 years old, Adani finally accumulated enough funds to start Adani Export Co., Ltd., which gradually developed into the Adani Group.
With the continuous expansion of the commercial territory, Adani not only owns India's largest private power plant, Asia's largest coal import terminal, but also controls nearly 1/4 of India's air traffic, sits on the world's largest coal mine Carmichael, and even has an absolute right to speak in the agricultural and real estate industries, known as "India's Li Ka-shing".
As for the reasons for the soaring wealth, the connection between government and business is an unavoidable topic. Some people pointed out that it is precisely because of this relationship that Adani has gone further and grown into a business predator.
Public information shows that in 2003, Adani met Modi, then the chief minister of the Indian state of Gigirat, and the two could be said to be at the end of the day – at that time, Adani was a small businessman, Modi's development in politics was not smooth, and he was also criticized by all walks of life for handling problems improperly.
But Adani was "discerning" and actively stood behind Modi. Breaking with the business elite to defend Modi, forming a chamber of commerce to help Modi "brush his face" in the political and business circles, providing funds during Modi's campaign, giving his private jet to Modi... In 2014, Modi was elected prime minister of India and has been until today, Adani, who is close to Modi, has successfully "taken off".
State-owned land in the Indian state of Gigirat was leased to the Adani Group for as little as $1 per square meter, and the Adani Group leased it to someone else for $11 per square meter.
In related outbound investment and trade activities, the Adani Group has become a "royal" enterprise, which has cut a large share from various bilateral cooperation agreements between India and foreign countries.
In India's $7 billion coal mining agreement with Australia, Adani Group became India's largest coal supplier; Won a $6 billion PV development plan bid to become a PV giant; Cut into the India-Japan high-speed rail construction, Bangladesh thermal power plant and other projects...
Behind Adani's wealth label is a feast of wealth obtained through monopolies and resources. And Adani and his business empire grew rapidly into a giant, which naturally made sense.
3.
/ How long can the richest man do when the debt crisis appears? /
However, rapid expansion is a "double-edged sword", and under the aura of great wealth, hidden crises have gradually begun to appear.
Although Adani has achieved double success in the capital market and personal wealth, it has also brought huge debt pressure to Adani Group.
As Adani Group is increasingly involved in emerging businesses outside the main business, and many of its business layouts are asset-heavy industries, this has caused a lot of pressure on the group's credit indicators and cash flow.
What did the Adani Group rely on for its expansion? On the surface, it depends on the management of government-business relations, but at a deep level, it relies on the capital game of "left hand to right hand".
According to the relevant financial report data, as of fiscal 2022, the total debt of the 7 listed companies of the Adani Group has reached 28.9 billion US dollars, considering that many of the projects involved in the company have a long payback cycle and the market interest rate is in an upward trend, the debt of the Adani Group has shown a high-speed growth trend as its expansion.
How big is the Adani Group in expanding its business territory?
Last November, Adani Group pledged to invest $70 billion in the green energy sector by 2030; In May, the group acquired Holcim's Indian subsidiary and alumina manufacturing business for $10.5 billion, and plans to acquire a partial stake in New Delhi Television.
Where does the money come from? Presumably, the financing market is the best place to move. If there is a business risk or a variable in the relationship between government and business, Adani Group may fall into the risk of debt default.
As early as 2015, Adani was listed by Credit Suisse as one of the companies with the worst debt backlog, when its outstanding debt was more than $30 billion. If such a company is in the normal business market, then it will certainly face strong supervision, and it is impossible to participate in bidding and acquisition projects.
Adani's way of solving the problem is quite simple and crude, that is, directly relying on administrative forces to intervene.
Amending the Special Economic Zone Law to grant Adani exemptions from import duties on coal, selling ports to Adani at low prices, requiring foreign ships to call preferentially at private ports where the Adani Group has an advantage... All kinds of jaw-dropping stories were staged in Adani.
From the perspective of Adani's entrepreneurial history, the so-called innovation, upgrading, scientific and technological progress... These have little to do with him, and it is difficult for ordinary entrepreneurs to learn any reliable experience from them.
After all, his wealth has soared, and it seems more like luck than a business success that follows the rules of the market. At a time when the market situation is changing, it is difficult to say how long his richest man can do it?