Alok Sanghi used to work in his family’s cements business, Sanghi Industries, which his father founded more than four decades ago.
In 2023, they sold a majority stake to a much bigger rival, Ambuja Cements Ltd., controlled by Gautam Adani, India’s richest person.
Sanghi, 42, now oversees a luxury real estate business in Dubai, a professional volleyball team, and a handful of startups. He also trades in the private, public and commodities markets through a family office with $100 million in assets under management.
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“Most families had a single engine of growth which was the business, and if the business did well or badly, the family was affected,” Sanghi, who runs his family’s investment firm Resolute Corp., said in an interview. “Now business owners want to separate the two so that the fate of the business and families are de-coupled.”
The shift from dynastic enterprise to money management is picking up in one of the world’s fastest growing economies, worrying some of the nation’s elders. For the richest of the rich, family control remains paramount and selling out isn’t really an option. The kids of Adani and Mukesh Ambani are working to push their dynasties forward from industrial roots into data centers and tech. But, the younger generation of families worth hundreds of millions of dollars increasingly are cashing out, taking their inheritance and investing it elsewhere.
In an economy dominated by first-generation fortunes, it’s become a broader discussion about society and the country’s future. Indian billionaire Uday Kotak, the founder of Kotak Mahindra Bank, lamented last year that many scions of rich families were “taking the easy way out” by running family offices and trading financial assets. “They should be creating real-world businesses,” said the 67-year-old.
It’s also a question of identity. Some of India’s business families trace a line to pre-independence from the British Empire. Carrying the baton forwards has become a way of establishing social credit. The Wadia family began in 1736 making ships for the British East India Company and evolved into a conglomerate that makes biscuits and fabrics. The Bajaj dynasty began with a cotton business in 1905 and later became one of the world’s biggest motorcycle makers. Both are still family owned.
“Our generation which is over 60 years of age has to give the younger generation space,” said Raamdeo Agrawal, a billionaire who co-founded stock brokerage Motilal Oswal Financial Services Ltd. with his partner Motilal Oswal about four decades ago. Agrawal’s son is a money manager at the asset management arm and may, over time, take on more responsibilities. “I told him that you have to get the respect of your colleagues and the company. He has to learn the tricks of the trade.” he said in an interview.
For family-backed firms with fewer business lines, the economics can be quite different. In some cases, their operating companies are no longer growing as much as before, forcing owners to rethink their succession and wealth preservation plans. Managing investments through a family office wasn’t an option when Adani and Agrawal started their businesses, but India’s rapid financial boom has given medium-sized and smaller family businesses a chance to exit.
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