India’s richest man loses $5.6 billion as rupee stumbles

Mukesh Ambani, India’s richest man, is the biggest loser among the country’s billionaires as the rupee’s slump to record lows erased 24 percent of his fortune.

The chairman of Reliance Industries Ltd. (RIL), operator of the world’s biggest oil refinery complex, has lost $5.6 billion of his wealth since May 1, as the rupee’s plunge accelerated. The 56-year-old is left with a net worth of $17.5 billion, according to the Bloomberg Billionaires Index.

The Indian rupee is the worst-performing major currency in the world in the past month, coming under pressure as international investors sold emerging-market assetsamid concern the U.S. will pare its $85 billion monthly stimulus, Bloomberg reports.

The value of holdings by India’s billionaires are worth less in dollars as the rupee declined and foreign investors sold shares in large-cap companies, said Munesh Khanna, a senior partner at Grant Thornton LLP in Mumbai.

“There is irrationality; the rupee is weak and will go down further,” Khanna said.

“Foreign institutional investors are invested in the larger-cap companies and are pulling out money from India. That is putting a lot of pressure on those companies.”

International investors have sold a net $3 billion of Indian stocks since June 3, according to the nation’s Securities & Exchange Board. The S&P BSE Sensex (SENSEX) index declined 1.9 percent to 17,905.91 yesterday, extending its four-day drop to 7.6 percent, the most since July 2009. The rupee also extended its slide Wednesday, touching an all-time low of 64.55 per dollar.

Billionaire Brother

Anil Ambani, the younger brother of Mukesh, has lost 17 percent, or $1.3 billion, of his net worth since May. Ambani, 54, has a fortune of $6.3 billion and is the country’s eighth-richest man, according to the Bloomberg ranking. The majority of his wealth is derived from stakes in publicly traded companies, including Reliance Communications Ltd. (RCOM), India’s third-largest mobile-phone company by market value.