Why is Mukesh Ambani the richest person in India and not Ratan Tata?

Tata Group is among the world’s top 50, according to market capitalization and reputation but still, Ratan Tata is not the richest man in India And Mukesh Ambani, MD of Reliance Industries is the richest person in India.  Why? It is all about the shareholding pattern i.e who owns the shares

When asked about Why Is Mukesh Ambani The Richest Person In India And Not Ratan Tata?

Mr Ratan Tata smartly answered, “We are Industrialist and they are businessmen”.

Overview of Why Mukesh Ambani and not Ratan Tata is the richest person in India?

Mukesh Ambani has a net worth of $40 billion as of 2018.  Mukesh Ambani is the chairman, managing director of Reliance Industries Limited (RIL). He holds over 72,31,692 of Reliance Industries shares. And Reliance Industries shares have been rising. Therefore, he is the richest person in India. On 13 Sep 2019 stock price of Reliance was 1226.70. Assuming Reliance share price as 1200.  The net worth of Mukesh Ambani shares is 72,31,692 X 1200=8,72,67,80,30,400 or 87267.80304 Crores in Indian Rupees. Mukesh Ambani also earns an annual salary of 15 crores as MD of Reliance. He also owns a residential property, Antilla, worth more than $400 million and the Mumbai Indians professional cricket team.

Ratan Tata’s net worth is estimated to be around $1 billion. Although Ratan Tata’s family, Tata’s, owns over 86% of Tata Group shares, they are mostly used for philanthropic and charity works.  Ratan Tata just owns 3368 shares of TataSons which is 0.83% of the total shares. Ratan Tata was the chairman of Tata Group of companies from 1991-2012 & 2016-2017 billion.

About Tata Group

Tata is a global business group with products and services in over 150 countries, over 695,000 employees and operations in over 100 countries TATA Group runs 96 businesses, of which 28 companies are publicly listed on the various stock exchanges. Founded in 1868 by Jamshedji Tata, the Tata group completed 150 years in 2018.  The image below shows the various companies under the Tata group. Our article About Tata Group: History of Tata, Tata ShareHolding covers Tata Group in detail.

But who owns the Tata group shares?

Tata Group and its companies
Tata Group and its companies

Tata Group Share Holding Pattern

The Tata family has been involved in philanthropic work since their establishment. They have contributed a lot to the betterment of healthcare facilities, improving the education system, fighting for equal rights, sports, and preservation of arts in India and international. They were awarded the Carnegie Medal of Philanthropy in 2007. Tata group donated ₹ 2.20 billion ($50 million) to the Harvard Business School, the largest amount received by the institute from an international donor.

Tata Sons Limited is the holding company of the Tata Group and holds the bulk of shareholding in the Tata group of companies including their landholdings across India, tea estates and steel plants. About 66% of the equity capital of Tata Sons is held by philanthropic trusts endowed by members of the Tata family. The biggest two of these trusts are the Sir Dorabji Tata Trust and Sir Ratan Tata TrustRatan Tata just owns 3368 shares of TataSons which is 0.83% of the shares.

Who owns How many shares of Tata Group?
Holding pattern of Tata

Mukesh Ambani and Reliance Industries

Mukesh Ambani is the chairman, managing director, and the largest shareholder of Reliance Industries Limited (RIL). The image below shows the revenues and Earning before Income Tax(EBIT) from different businesses of Reliance. Our article Mukesh Ambani: Richest Man of India covers Mukesh Ambani in detail.

Reliance Revenue, Profit from different companies
Reliance Revenue, Profit from different companies

Reliance Share Holding Pattern

Though Mukesh Ambani holds also 0.12% of Reliance Industries shares but the number of shares are 72,31,692 and Stock price of Reliance has been rising.

Reliance Stock Price

The image below shows the stock price of Reliance Industries
Stock price of Reliance over period of time
The stock price of Reliance over a period of time

 

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