Billionaires’ net worth unscathed, but there’s a catch

Just five of the 18 Indians listed in the top 500 globally made gains to their net worth in this period, gaining 15% together in their net worth. The other 13 lost 19%, in line with the rest of the world if only those who lost are considered. Canada’s 15 billionaires in the top 500 are the biggest losers, having seen a 43% dip as a group in their combined net worth this year.

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Billionaires across the globe have lost billions of dollars this year due to the sharp correction in stock markets as the war in Ukraine, global inflation and the winding down of monetary policies reverse the pandemic-era rally. A broad-based downward trend has been seen across most asset classes in recent weeks.

The benchmark Sensex is down 5% this year, having peaked in October last year, and the Indian rupee has weakened 4.3% against the dollar. This has been driven by a global economic slowdown and tightening by the US central bank amid a worsening geopolitical situation in Europe.

As of 30 May, the net worth of 365 of the 500 richest individuals in the Bloomberg index has declined in 2022. This net worth is not an indicator of the money these individuals have but is rather a theoretical term that includes the value of their shareholdings in companies. This fluctuates with the stock market every day.

Overall, the 500 billionaires had a combined net worth of $8.4 trillion at the beginning of the year. That stands at $7.3 trillion as of 30 May. However, among the 18 Indians on the list, the net worth has declined from $415 billion to $404 billion.

In the first year of the pandemic, a Mint analysis found that India had a new class of billionaires in healthcare, technology and retail. However, that trend seems to have changed in 2022.

Wipro founder Azim Premji incurred the highest loss among Indian billionaires, both in absolute and percentage terms: $13 billion, or 32% of his net worth at the beginning of 2022. India’s information technology stocks witnessed a sharp correction in the last few months, with Wipro falling 34%.

Vaccine king Cyrus Poonawalla, the founder of the Serum Institute of India has suffered a loss of nearly $2 billion.

Globally, corporate owners in the consumer goods and technology sectors have made the biggest losses—24% and 21%, respectively. In the US alone, the net worth loss of tech owners was $338 billion. Billionaires in the healthcare sector lost 19% and finance 16%.

In India, chairman of Adani Group, Gautam Adani, gained over $25 billion in the last five months, followed by Mukesh Ambani of Reliance Industries, who gained around $4 billion.

Most Adani stocks, including Adani Power, Adani Enterprises, and Adani Green, have fared well this year.

A quarter of the billionaires in the top 500 list made gains over the period of analysis, and they are largely spread across commodities and energy sectors. India has only three billionaires from the commodities sectors in the top 500, and they all lost net worth.

The US has 174 billionaires in the top 500, followed by China (73), Germany (27), Russia (25), and India (18).

The S&P 500 has fallen nearly 14% since the start of the year, driving record losses for the world’s wealthiest, including Elon Musk, Jeff Bezos, Bernard Arnault, Bill Gates, and Larry Page, who have lost a total of $185 billion so far in 2022. Changpeng Zhao, the CEO of crypto exchange Binance tops the list for the largest year-to-date drop ($79.5 billion, or 83% of his net worth at the beginning of 2022) so far.