Conglomerates tighten grip on India's economy

TL;DR

Six Indian family business groups now control nearly 20% of NSE500 corporate profits for FY25.
These groups, including Reliance and Adani, expanded into new sectors more aggressively in the last five years than before.
Economists see this concentration as a flaw that crowds out new entrants in emerging industries.

The story at a glance

India's top family-run conglomerates like Reliance, Adani, Tatas, Bharti, Aditya Birla, and OP Jindal have grown their economic dominance since 2021 by pushing into fresh businesses. The article highlights Adani Group's recent Rs 14,535-crore ($1.6 billion) approval on 10 April to buy Jaiprakash Associates' assets, adding hotels, an F1 track, land, and cement market share. This comes amid reports of rising concentration, now flagged by economists as a problem for competition.

Key points

Six family groups account for nearly 20% of corporate profits among NSE500 companies in FY25, with a similar share of India's GDP—higher than in advanced economies.[[1]](https://the-ken.com/story/reliance-to-adani-conglomerates-tighten-their-grip-on-the-economy-since-2021/)[[2]](https://the-ken.com/story/reliance-to-adani-conglomerates-tighten-their-grip-on-the-economy-since-2021)
In the five years to 2025, these groups diversified faster than in the prior period, using cash from older regulated sectors to enter new-economy areas.
Adani's bid for bankrupt Jaiprakash Associates wins luxury hotels, India's sole Formula 1 track, NCR land banks, No. 2 cement spot, and energy cash flows, forming regional duopolies.
Earlier studies show 25 family groups held nearly a fifth of GDP in the century's first two decades; the trend has sharpened lately.
McKinsey calls this "conglomerate 3.0" or ecosystem-based organisations; economists term it concentration that limits competition.

Details and context

The article parses activities of the six groups to show relentless expansion, often via acquisitions like Adani's. This builds on past patterns where family firms diversified heavily, but post-2021 acceleration raises flags for crowding out startups in tech and green sectors.

Size lets these players compound advantages—old profits fund bold bets—unlike smaller firms facing capital hurdles. Compared to peers in advanced markets, India's skew is stark, with economists warning it stifles broad growth.

The Jaiprakash deal, approved amid rival bids from Vedanta and others, exemplifies how insolvency processes aid such leaps, adding immediate assets and market power.[[3]](https://swarajyamag.com/news-brief/supreme-court-refuses-to-block-adanis-rs-14535-crore-takeover-of-jaiprakash-associates)

Key quotes

“It’s a rare financial alchemy. In one stroke, the Adani Group... vaults itself into entirely new businesses and solidifies some old ones.”[[1]](https://the-ken.com/story/reliance-to-adani-conglomerates-tighten-their-grip-on-the-economy-since-2021/)

Why it matters

Few conglomerates holding one-fifth of profits and GDP risks less competition, higher prices, and fewer jobs from new firms across India. Investors and consumers face duopolies in cement or telecom; businesses see tougher entry in energy or digital spaces. Watch NCLAT hearings on the Jaiprakash deal and FY26 profit data for signs if the skew worsens.