Billionaires: Falguni Nayar becomes India's richest self-made woman with $7bn

In our fortnightly round-up, Red Bull's Dietrich Mateschitz is set to receive a bumper payout and Mukesh Ambani's Reliance Industries embarks on a shopping spree for local five-year bonds

Falguni Nayar, left, the managing director and chief executive of Nykaa, an online marketplace for beauty and wellness products, with her daughter, Advaita, attends the company's IPO listing ceremony at the National Stock Exchange in Mumbai earlier this month. AFP
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Falguni Nayar

Falguni Nayar joined the rarefied ranks of self-made billionaire women after the Indian beauty start-up she founded went public and promptly doubled on its trading debut. Now she’s encouraging more women to seize control.

Ms Nayar runs India’s FSN E-Commerce Ventures, which raised 53.5 billion Indian rupees ($720 million) in its initial public offering on November 10 and saw shares rise 96 per cent on its first day of trading.

That makes Ms Nayar, who owns about half of the company, worth almost $7bn and India’s wealthiest self-made female billionaire, according to the Bloomberg Billionaires Index.

“Women need to allow the spotlight of their lives to be on themselves,” Ms Nayar said in an interview after the trading debut. “I hope more women like me dare to dream for themselves.”

Nayar founded her company, which runs the e-commerce site Nykaa, in 2012 after working in investment banking and guiding other entrepreneurs through the initial public offering process.

Back then, most Indian women bought make-up and haircare products at neighbourhood “mom-and-pop” stores where the selection was scanty and trials unheard of. She saw an opportunity in giving customers easy online access to high-end beauty items, complete with tutorials and testimonials.

“India is going to be a huge retail market,” Ms Nayar said. “Indians will aspire for more, their spending power will grow and they’ll increasingly spend on lifestyle brands and services. Nykaa is in a good place.”

The start-up has since grown into the country’s leading beauty retailer, buoying online sales with demo videos by glamorous Bollywood actors and celebrities, and more than 70 brick-and-mortar stores.

The size of the prize doesn’t really matter. Being rewarded for doing what I love doing is the key. Share prices are the bonus
Falguni Nayar, founder of FSN E-Commerce Ventures

Nykaa, derived from the Sanskrit word for heroine, sells items including exfoliation creams, bridal make-up essentials and hundreds of shades of lipstick, foundation and nail colours to suit Indian skin tones, skin types and local weather.

Ms Nayar said there is plenty more opportunity ahead. In the country of 1.3 billion people, men, too, are beginning to spend on make-up and grooming products.

“We have built the company for multiyear growth to address a very large beauty and fashion e-commerce market in India,” she said.

While clearly pleased with the strong IPO debut, Ms Nayar said she was sanguine about the precise impact on her net worth.

“The size of the prize doesn’t really matter,” she said. “Being rewarded for doing what I love doing is the key. Share prices are the bonus.”

Dietrich Mateschitz

Austrian billionaire Dietrich Mateschitz is getting a bumper payout of €680.5m ($762m) after his Red Bull energy drink empire grew unabated despite the pandemic gripping the world economy.

Red Bull GmbH, the holding company overseeing sales of the canned caffeine-spiked drink, booked net revenue of €6.3bn in 2020, 4 per cent more than a year earlier, according to the group’s annual report posted to the Austrian company register.

Sales rose more than 12 per cent in the US and 3.4 per cent in Europe, compared with declines in revenue across the rest of the world. The company also saved on marketing costs as the pandemic hit some of the sports events it sponsors.

That produced net income of €1.18bn, a 29 per cent increase from 2019.

Red Bull is paying out half of the year’s distributable profit plus €500m of retained earnings to Mr Mateschitz and his co-shareholders, Thailand’s Yoovidhya family, which controls 51 per cent of the company, according to a resolution of the shareholders attached to the annual report.

Mr Mateschitz gets an additional €165m extra dividend on top of his pro rata amount, according to the resolution, which gives no reason for the different treatment. Chalerm Yoovidhya also gets an extra €3.2m.

The bump from retained earnings will lift Red Bull’s total dividend to more than double the amount paid to shareholders last year.

Mukesh Ambani

Reliance Industries, which runs one of India’s biggest Treasury operations, went on a shopping spree for local five-year bonds just weeks ahead of a crucial central bank policy meeting, according to people with knowledge of the matter.

The company, controlled by Asia's richest man Mukesh Ambani, bought about $270m worth of state bonds from a single state-run bank, according to one of the people, with others adding that total purchases may have exceeded $1bn in the past few days based on brokerage orders and trade deals reported on the central bank platform. The people asked not to be identified as the details are private.

The purchases by Reliance blazed through trading rooms in Mumbai, helping the five-year sovereign bond outperform as banks and brokerages sought to fulfil the orders. They could reflect an attempt by the company to find the safest part of the yield curve as expectations grow that the Reserve Bank of India will tighten monetary policy soon.

A Reliance Industries spokesperson didn’t immediately respond to an emailed request for comment.

The company, which was buying a mix of sovereign and local government debt maturing in 2026, bought debt on the central bank’s dealing platform as well as through direct deals with holders, the people said.

Reliance had cash and equivalent assets worth 2.6 trillion rupees as of September 2021, according to its financial presentation. Last year, Reliance took a similar bet in corporate bonds with the similar maturity.

The purchases come ahead of an RBI meeting on December 8, which will be keenly watched by investors to see what steps the central bank takes to normalise pandemic-era policy settings after it suspended bond purchases last month.

IDFC Asset Management said last month they are “heavily overweight” on tenors of about five years on expectations that they will be less affected by rate hikes.

Anil Agarwal

Billionaire Anil Agarwal’s Vedanta said it intends to streamline its structure and is looking at options including separately listing its aluminium, iron and steel, and oil and gas units.

The latest plan to restructure the Mumbai-listed commodities major comes a year after Mr Agarwal’s efforts to take the company private failed. A greater control of the cash-rich company would help the billionaire pare down debt at his holding group.

The restructuring is aimed at unlocking value for all stakeholders and could include options such as demergers, spin-offs and strategic partnerships, Vedanta said in an exchange-filing, adding that the board has formed a committee to evaluate the plan. It didn’t give a timeline for the proposed restructuring.

Vedanta’s group structure has always been considered as complex and a simplification will certainly be a positive
Prashanth Kumar, analyst at Dolat Capital Market.

The rejig will allow the units to benefit from “tailored capital allocation, and strategic flexibility to drive long-term growth”, Agarwal said. The move will also accelerate the company’s plans to cut emissions, it said.

“Vedanta’s group structure has always been considered as complex and a simplification will certainly be a positive,” according to Prashanth Kumar, an analyst at Dolat Capital Market.

“Currently, many funds may not like to invest in Vedanta because the aluminium business’s carbon footprint is higher. Having separate entities may attract a broader and wider range of investors in their other businesses.”

Shares in the company have more than tripled over the past year as commodity prices rallied and demand for metals boomed globally.

Updated: November 28, 2021, 5:09 AM