MARKET PERSPECTIVE

By J Mulraj

May 9-15, 2026

The Beyond-Visual-Range Dreams of Elon Musk

Global markets are buzzing with anticipation of the forthcoming IPO of Elon Musk’s company SpaceX, likely (unconfirmed) in mid June, 2026. The company is expected to raise $75 billion, by selling under 5% of its equity, at a valuation of a mind blowing $ 1.5 – 1.75 trillion! The amount raised will eclipse the hitherto highest raise, by Saudi Aramco, of 29.4 b. in 2019. A successful IPO (which is expected) will make it the first company to be valued at over $ 1 trillion.

Several Index producers, like Nasdaq 100, S&P 500, FTSE Russell and Morningstar CRSP, are preparing for inclusion of SpaceX in their indices immediately after a successful IPO, or within weeks, so as to get passive funds to buy. Normally companies wait for a 3 month seasoning period (6 months in India). The effect of inclusion in indices on the stock price is bullish as it creates an automatic demand from passive funds/ETFs.

SpaceX is a launch company, launching rockets into space which are retrieved on re-entry and are re-usable. It has partnered in NASA’s Artemis programme, an ongoing international human space flight programme designed to return humans to the moon. It aims to build human space camps for long duration visits to the moon, as a prelude to ones on Mars.

Besides the launch activities, SpaceX also has Starlink, a company founded by it with Elon Musk, to provide high speed, satellite based global internet services. Used, for example, in war torn Ukraine and the civilians in Iran after the regime cut off internet access. It has launched over 10,000 satellites in low earth orbit.

SpaceX has also acquired xAI, the artificial intelligence company founded by Elon, in an all stock deal, valuing xAI at a stunning $ 1.25 trillion. With this came X (earlier Twitter) the free speech platform Elon had taken over.

xAI had earlier built two supercomputer clusters in Memphis, Tennessee, Collosus 1 and 2. Collosus 1 delivers over 300 MW of capacity using 220,000 NVidia GPUs. It has been recently leased to Anthropic, which has been compute constrained for it’s AI agent, Claude. Collosus 2 houses over 550,000 Nvidia Blackwell GPUs. After it was built, to supply compute for xAI’s Grok, Collosus 1 became available to monetise.

This combination of businesses enables SpaceX to launch satellites to establish space based data centres to provide the compute required to power AI services. AI services need a constant supply of electric power, and its needs cannot be met by terrestrial power facilities. Space based satellites will use the near constant flow of solar power, with low maintenance costs, to generate electricity to scale up AI.

Elon Musk is a visionary and a dreamer with the technological genius to create products and services to achieve his dreams.

Sometimes it seems to be like sci-fi. Just look at Elon’s pay package deal with SpaceX. The package awards Elon a huge amount of Class B shares (which carry 10 votes instead of 1 for class A shares) if he reaches two milestones. The first, called Mars Colony Milestones will grant him 200 million Class B shares if he achieves a $7.5 trillion market cap for SpaceX and also creates a permanent settlement for 1 million people on Mars! Getting a million people to live on Mars is the stuff of sci-fi, but Elon has accepted it! It seems a crazy target, because Earth and Mars have to align in a particular manner for a fuel efficient round trip, and such an alignment happens once every 26 months.

A one way trip to Mars takes 7-9 months. It is hard to imagine how Elon would be able to convince a million people to travel that long in space and then to live there.

Probably the humanoid robots will work to construct houses; the Artemis programme will provide the experience to settle people; perhaps Starlink will provide communication with Earth; one can only guess.

Elon’s pay package with Tesla is more earthly. He has to hit certain target milestones to be rewarded with a huge payout in additional shares. If he does not, he gets nothing. He gets no pay or bonus for ten years.

The ultimate tranche requires him to achieve a market cap for Tesla of $ 8.5 trillion in ten years. He will then get 423 million additional shares. The package is valued at $1 trillion, but after certain payments to Tesla, the net reward will be $ 878 b. In addition, he must scale vehicle production to 20 million cars per year, build or sell 1 million Optimus robots, deploy 1 million robot taxis, and secure 10 million subscribers for its FSD (full self driving) feature.

With a pay package thus defined, the interest of shareholders are aligned with the interest of the CEO. In fact the shareholder is better placed. If Elon manages to hit a market cap of, say, $ 8 trillion, instead of the target $8.5 trillion, he gets nothing, but the shareholder gets a good appreciation.

In geopolitical news, a diplomatic solution to the Iran conflict seems impossible. The stance of Iran and USA are miles apart, further than Mars. During the pause, Trump made a planned visit to China, accompanied by the ‘who’s who’ of US industry. He managed to get Xi Jinping interested to buying some Alaskan crude oil, some agricultural products and 200 Boeing aircraft. But no intervention on Iran except to restate that the Strait of Hormuz should be open to all and not under anyone’s control. So it appears that Trump may resume military operations.

Last week the BSE Sensex closed at 75237, down 2091 points over the week.

The Indian economy will be hit because of various reasons such as high crude oil prices, shortage of fertilisers, affecting agricultural output, adverse impact of El Niño, and the inability to stanch corruption or judicial delays.

It is the retail investor, pumping money every month, as committed by him in SIP (systematic investment plans) schemes of mutual funds, that has been propping up the equity market. Foreign portfolio investors have seen their dollar returns whittled away by the weakening rupee, and are missing.

It is advisable to get light. After a peak, the sharp fall quite often doesn’t present investors an opportunity to exit. None of them are as fleet footed as Fred Astaire. Maybe, after a successful SpaceX IPO, Elon Musk may teach them the Moon Walk.
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Comments may be sent to jmulraj@asiaconverge.com

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