Mukesh Ambani loses Asia wealth crown to Jack Ma in $5.8 billion rout

News Network
March 10, 2020

Mar 10: Indian energy tycoon Mukesh Ambani is no longer Asia’s richest man, relinquishing the title to Jack Ma after oil prices collapsed along with global stocks.

The rout, exacerbated by mounting fears that the spread of the novel coronavirus will thrust the world into a recession, erased $5.8 billion from Ambani’s net worth on Monday and pushed him to No. 2 on the list of Asia’s richest people, according to the Bloomberg Billionaires Index. Ma, the Alibaba Group Holding Ltd. founder who relinquished the No. 1 ranking in mid-2018, is back on top with a $44.5 billion fortune, about $2.6 billion more than Ambani.

Oil plunged the most in 29 years on Monday as Saudi Arabia and Russia vowed to pump more in a struggle for market share. The slump comes just as the coronavirus is spurring the first decline in demand in more than a decade. That raises questions about whether Ambani’s flagship Reliance Industries Ltd. will be able to cut net debt to zero by early 2021, as he has pledged. The plan hinges on a proposal to sell a stake in the group’s oil and petrochemicals division to Saudi Arabian Oil Co., the world’s biggest crude producer.

While the coronavirus has curtailed some of tech giant Alibaba’s businesses, the damage has been mitigated by increased demand for its cloud computing services and mobile apps.

Reliance Industries, by comparison, has no such silver lining. The Indian conglomerate’s shares plunged 12% on Monday, the most since 2009, extending this year’s decline to 26%. Alibaba’s American depositary receipts have slipped 6.8% so far in 2020.

Ma reclaims crown after Reliance shares were pummeled in 2020.

Few of the world’s billionaires fared well in Monday’s collapse as the S&P 500 Index and Dow Jones Industrial Average each plunged more than 7.5%, the most since the 2008 financial crisis, threatening to end the longest bull market in history. But no one did worse than those whose fortunes are underpinned by oil. Wildcatter Harold Hamm’s fortune was cut almost in half to $2.4 billion and fellow oil magnate Jeff Hildebrand lost $3 billion, bumping both from Bloomberg’s 500-member wealth ranking.

In a pivot toward new businesses such as telecommunications, technology and retail, Ambani’s Reliance Industries has piled on billions of dollars of debt over the years.

It spent almost $50 billion -- most of it funded by borrowings -- to build Reliance Jio Infocomm Ltd., which became India’s No. 1 wireless carrier within about three years of its debut. As the mobile venture took off, Ambani also unveiled plans for an e-commerce empire to rival Amazon.com Inc. in India.

Addressing concerns over the liabilities, Ambani pledged in August to cut the group’s net debt to zero from about $21 billion as of last March. The Aramco deal is crucial to that plan for which Reliance Industries has valued its oil-to-chemicals division at $75 billion including debt, implying a $15 billion valuation for the 20% stake that’s for sale.

Signs of a potential delay to that deal unnerved some investors, hammering the stock since it touched a record high on Dec. 19.

Reliance Industries expected the Aramco transaction to be completed by March, but people familiar with the matter said in February that talks were still ongoing to bridge differences between the two parties over the deal’s structure.

Adding to the uncertainty, Indian Prime Minister Narendra Modi’s administration has petitioned a court to halt the proposed stake sale, threatening a key source of funds needed to pare net debt.

But Ambani, 62, may soon bounce back from the setback, said Harish H.V., managing partner at ECube Investment Advisors in Bengaluru, India.

“The game isn’t over,” he said. “Ambani has successfully built a robust business model which would keep him in the game. Moreover, his telecom business will start yielding results in coming years.”

Comments

SmR
 - 
Tuesday, 10 Mar 2020

The curses of the bank depositors savings which vanished with collapsing economy and fraudlent seems to have gradully affecting riches of Ambani's.

 

AU
 - 
Tuesday, 10 Mar 2020

in Holy Quran Allah says; but they plan and Allah plans, and Allah is the best planners..(Surah Al Anfal 8:30)

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News Network
April 25,2020

New Delhi, Apr 25: Neighbourhood and standalone shops, including those selling garments, mobile phones, hardware and stationery items have been allowed to open but those located in market places, malls and COVID-19 hotspots and containment zones, will continue to remain shut till May 3.

In rural areas, all shops, except those in single and multi-brand shopping malls, are allowed to open.

However, a Home Ministry official said the final decision of whether to allow the additional shops to open or not will be taken by the state governments and Union Territory administrations depending on their respective COVID-19 situation.
 
While allowing opening of more shops, a move seen as a relief to people who have been under lockdown since March 24, the government order issued on Friday night said the shops will be functioning with 50 per cent of workforce and after adhering strictly to precautions which include social distancing and wearing of masks.

The Union Home Ministry also said malls, liquor and cigarette shops, sale of non-essential items through e-commerce platforms continue to remain shut.

Restaurants, hair salons and barber shops will not be allowed to open as these render services and do not fall under the shop category.

Amending its April 15 order, Union Home Secretary Ajay Bhalla said in the Friday night order that "all shops, including neighbourhood shops and standalone shops, shops in residential complexes, within the limits of municipal corporations and municipalities, registered under the the Shops and Establishment Act of the respective State and UT" will be allowed to open during the lockdown.

The ministry also said shops located in registered markets located outside the municipal corporations and municipalities can open after following the drill of social distancing and wearing of masks but with 50 per cent of strength.

However, single and multi-brands shall continue to remain closed in these areas also.

"All shops registered under the the Shops and Establishment Act of the respective State/UT, including shops in residential complexes and market complexes, except shops in multi-brand and single brand malls, outside the limits of municipal corporations and municipalities, with 50 per cent strength of workers with wearing of masks and social distancing being mandatory" will be allowed to function, the order said.

In a statement on Saturday, the Home Ministry said the order implies that in rural areas, all shops, except those in shopping malls are allowed to open.

In urban areas, all standalone shops, neighbourhood shops and shops in residential complexes are allowed to open.

Shops in markets and market complexes and shopping malls are not allowed to open.

"It is clarified that sale by e-commerce companies will continue to be permitted for essential goods only," the order said and also added that sale of liquor and other items continues to be prohibited as specified in the national directives for COVID-19 management.

The ministry said that liquor shops were given licence under the Excise Act of the states and the establishments thrown open from Saturday were covered under the Shops and Establishment Act of the states.

Sale of cigarettes, gutka are continue to be prohibited during the lockdown.

"As specified in the consolidated revised guidelines, these shops will not be permitted to open in areas, whether rural or urban, which are declared as containment zones by respective States and Union Territories," the statement said.

The lockdown was first announced by Prime Minister Narendra Modi on March 24 in a bid to combat the coronavirus pandemic. It was further extended till May 3.

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Agencies
August 6,2020

Mumbai, Aug 6: Former Reserve Bank of India governor Raghuram Rajan said on Thursday that overly focusing on what sovereign rating agencies think can take one's eyes off what needs to be done for the economy.

"It is also important to convince both domestic and international investors that after the crisis associated with the pandemic is over, we will return to fiscal responsibility over the medium term, and the government should do more to convince them of that," Rajan told the Global Markets Forum.

India was placed under one of the strictest lockdowns in the world in late March for more than two months to stem the spread of the coronavirus, but cases have continued to rise steadily since the government eased restrictions in June, stymieing hopes of an economic recovery.

The government has announced several initiatives to help the poor and small- and medium-size businesses, but actual cash outgo from the government's measures has been estimated at just about 1% of GDP.

Several attribute the fiscal prudence to fear of a downgrade after Moody's cut India's rating and outlook in early June followed closely by a change in outlook from Fitch.

The central bank on its part too has reduced the key lending rate by 115 basis points on top of the 135 bps last year and is widely expected to cut rates by another 25 bps later on Thursday.

"The RBI and government have certainly been cooperating, but it seems like it is elsewhere, the ball is in the government's court to do more," Rajan said.

He said the RBI needs to focus on whether credit is reaching the stressed areas of the economy and also if the viable firms were able to access credit and not the unviable ones.

"And I think that's where it has to focus its attentions, because resources, as you well know, are limited in India today."

Recently analysts, however, have cited the growing possibility the RBI may prefer to pause and cut rates only at its October meeting.

Government officials too have suggested the possibility of any more fiscal stimulus being announced, would only come in the second half of the fiscal year, once a recovery has taken root and coronavirus cases have peaked.

"What India should focus on at this point is protecting its economic capabilities, so that when it has dealt with the virus it can go resume activity in a reasonable way. That should be the focus," Rajan said.

"And if it does that, there is no reason why the rating agencies will not see that as an appropriate policy".

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News Network
April 23,2020

Washington, Apr 23: Air pollution over northern India has plummeted to a 20-year-low for this time of the year, according to satellite data published by US space agency National Aeronautics and Space Administration (NASA).
The US space agency's satellite sensors observed aerosol levels at a 20-year low post the countrywide lockdown, implemented to slow the spread of the novel coronavirus.

"We knew we would see changes in atmospheric composition in many places during the lockdown," said Pawan Gupta, a Universities Space Research Association (USRA) scientist at NASA''s Marshall Space Flight Center. "But I have never seen aerosol values so low in the Indo-Gangetic Plain at this time of year," added Mr Gupta.

Acting Assistant Secretary of State for South and Central Asia Alice G Wells tweeted, "These images from NASA were taken each spring starting in 2016 and show a 20-year low in airborne particle levels over India. When India and the world are ready to work and travel again, let's not forget that collaborative action can result in cleaner air."

The data published with maps show aerosol optical depth (AOD) in 2020 compared to the average for 2016-2019. Aerosol optical depth is a measure of how light is absorbed or reflected by airborne particles as it travels through the atmosphere.

If aerosols are concentrated near the surface, an optical depth of 1 or above indicates very hazy conditions. An optical depth, or thickness, of less than 0.1 over the entire atmospheric vertical column is considered "clean." The data were retrieved by the Moderate Resolution Imaging Spectroradiometer (MODIS) on NASA's Terra satellite.

In the first few days of the lockdown, it was difficult to observe a change in the pollution signature. "We saw an aerosol decrease in the first week of the shutdown, but that was due to a combination of rain and the lockdown," said Mr Gupta.

Around March 27, heavy rain poured over vast areas of northern India and helped clear the air of aerosols. Aerosol concentrations usually increase again after such heavy precipitation.

"After the rainfall, I was really impressed that aerosol levels did not go up and return to normal. We saw a gradual decrease and things have been staying at the level we might expect without anthropogenic emissions," Mr Gupta said.

On March 25, the Indian government placed its 1.3 billion citizens under a strict lockdown to reduce the spread of COVID-19. The countrywide mandate decreased activity at factories and severely reduced car, bus, truck and airplane traffic. Every year, aerosols from anthropogenic (human-made) sources contribute to unhealthy levels of air pollution in many Indian cities.

Aerosols are tiny solid and liquid particles suspended in the air that reduce visibility and can damage the human lungs and heart.

In southern India though, the story is a little hazier. Satellite data show aerosol levels have not yet decreased to the same extent. In fact, levels seem to be slightly higher than in the past four years. The reasons are unclear but could be related to recent weather patterns, agricultural fires, winds or other factors.

"This a model scientific experiment," Robert Levy, program leader for NASA's MODIS aerosol products, said about the lockdown and its effects on pollution.

"We have a unique opportunity to learn how the atmosphere reacts to sharp and sudden reductions in emissions from certain sectors. This can help us separate how natural and human sources of aerosols affect the atmosphere," Mr Levy added.

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