Rich heirs of India's businesses cash out inheritance

Alok Sanghi, a 42-year-old heir to India's Sanghi Industries, formerly a cements business founded by his father, recently sold a majority stake to rival Ambuja Cements Ltd., a company run by billionaire Gautam Adani. The 42-year-old now oversees multiple businesses, including a luxury real estate venture in Dubai, a professional volleyball team, and some startups, all managed through a family office with $100 million in assets under management.

This shift from family-run businesses to investment management is on the rise in India, a fast-growing economy. While some billionaires like Adani and Ambani are determined to maintain control over their dynasties, the younger children of wealthier families are increasingly opting to cash out, investing their inheritance elsewhere. Indian billionaire Uday Kotak has criticized many heirs for "taking the easy way out" by running family offices and trading financial assets, instead of creating new businesses.

The tradition of family-owned businesses in India dates back to pre-independence days. However, as the economy evolves, some families find themselves with slower-growing companies, forcing them to reconsider their succession and wealth preservation plans. India now has over 300 family offices in 2024, compared to just 45 in 2018, with the number likely exceeding a thousand when including broader family investment firms.

These families are diversifying their wealth through investments and involvement in venture capital activities, seeking to support local entrepreneurs and fuel innovation.