Ambanis' Fortunes Plummet

The share prices have been tumbling in recent past for both the Reliance groups, led by the billionaire brothers Mukesh and Anil Ambani, and the analysts put the blame on a string of controversies surrounding them for many months now. On the other hand, a host of Tata group firms have grown stronger, in terms of stock market valuation, while shrugging off overall bearish sentiments in the broader market and even some controversies related to them.

As per the latest market value of individual groups,the Tata group ranks on the top with Rs 4,40,000 crore, and bigger than the combined figure of the two Ambani groups together at about Rs 3,67,000 crore. It is followed by Mukesh-led Reliance group at second position with about Rs 2,85,000 crore. The Reliance Anil Dhirubhai Ambani Group (R-ADAG), which ranked third after the Mukesh-led RIL group and Tatas a year ago, does not figure even among the top 10 groups now.

Source: www.business-standard.com, June 19, 2011

The reason for the downswing in the fortunes of the Ambani brothers is largely because of continual spats between the two, leading to reduced investor confidence in their companies.

After Dhirubhai Ambani’s demise, the long drawn ugly fight for control saw the credibility of the Ambani’s slip in the market. End result, the Reliance group, which always had the interests of ordinary shareholders as its primary focus, took a beating. Not just that, in the years that followed, the two brothers bitterly competed with each other and tried to sully each others images.

Having significant presence in the stock markets, any whisper about the activity between the Ambani brothers or change in their relationship moves markets.

We can only hope that at some point both Mukesh and Anil realise the harm they are causing to the Indian economy. If they could work towards a cordial relationship and have at least a loose working association, they could forge a formidable partnership.

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