How Tata, Ambani, Birla & Adani stocks fared during Modi regime
Data showed m-cap of Reliance Group climbed by Rs 4.84 lakh crore under the Modi government.
The two five-year periods were differentiated by changes in central bank policies globally, wherein easy money flowed into emerging market equities under UPA-II due to quantitative easing, while the later saw a trend reversal.
Hopes of an earnings rebound, meanwhile, remained elusive in both regimes. Data showed market capitalisation of the Mukesh Ambani-led Reliance Group climbed by Rs 4.84 lakh crore under the Modi government against a rise of just Rs 11,684 crore in the five years of UPA-II, thanks to the group’s years-long mega-scale investments into diversified businesses, including telecom and retail, and capacity expansion in the energy segment. These investment started delivering benefits, leading to a rerating of the group’s flagship firm RIL during the Modi regime.
Anil Ambani’s Reliance Group (ADAG) stocks might have rallied following exit poll projections of an NDA win, but the group actually saw its market value getting eroded by Rs 65,130 crore under Modi regime after a similar Rs 64,873 crore erosion under UPA II. For this calculation, the market value of Reliance Capital’s spun-off business Reliance Home Finance and the recently listed Reliance Nippon Life were also considered.
Tata Group stocks added Rs 4.22 lakh crore to their combined market capitalisation in last five years against Rs 5.33 lakh crore under UPA II, data compiled from corporate database Ace Equity shows. Healthy m-cap additions in Titan, TCS and Tata Communications were offset by value erosion in Tata Motors and Tata Power.
A tepid global environment hurt many of these groups. For example, luxury car demand came down globally after seeing a healthy 9 per cent annual growth over CY11-17, which hurt prospects of Tata Motors. Weak steel demand globally amid China slowdown and renewed trade worries have hurt steel prices and, hence, Tata Steel.
Data showed 10 Bajaj Group stocks added Rs 3.62 lakh crore to investors’ kitty in last five years compared with Rs 76,322 crore in the previous five years.
Aditya Birla Group stocks added Rs 1.05 lakh crore to market value under the Modi regime, much in line with Rs 1.02 lakh crore under UPA II.
Six of Adani Group stocks today has a total market-cap of Rs 1.63 lakh crore. The stocks included market value of Adani Ports, Adani Power, Adani Enterprises, Adani Gas, Adani Transmission and Adani Green. Three of these Adani companies, which were valued at Rs 99,898 crore at the beginning of Modi government – demerged Adani Transmission, Adani Gas and Adani Green got listed later. The market value of Adani group stood at the end of Rs 43,651 crore at the beginning of UPA-II.
Meanwhile, six Mahindra group stocks added Rs 48,000 crore to investor wealth under Modi rule against Rs 1,10 lakh crore in UPA-II.
“UPA-I and UPA-II coincided with global boom. You could call it the greatest boom the world had ever seen. India rode that boom extremely well. You got a huge increase in stock market outcomes because of that,” Swaminathan Aiyar, Consulting Editor, told ETNOW.
Data showed in 2010, 2012 and 2013 were the only three years in India’s market history when foreign inflows topped the Rs 1 lakh crore mark. In 2014, the Election year, FPI flows into India stood at Rs 97,069 crore. But between 2015 and 2019, total FPI flows into India was just Rs 1.20 lakh crore. However, rising domestic inflows helped cushion the impact.