The number of super-rich households in India has grown 12 per cent to nearly 2 lakh in 2017, while their collective net worth grew 5 per cent at Rs 153 lakh crore, nearly equivalent to the market capitalisation of all the companies listed on the BSE, a study of ultra high-net worth individuals (ultra HNIs) in the country noted.
The number of ultra HNIs is expected to more than double to over 3 lakh in five years while the total wealth would also jump more than twofold to Rs 352 lakh crore, the study by Kotak Wealth Managment said. It estimated the numbers after taking a minimum net worth of Rs 25 crore as the hurdle rate.
The study had global consultancy major EY was a collaborator. It used data points like India’s GDP growth, saving rate, investments in asset classes like stocks, mutual funds, real estate, gold, bank deposit growth, etc, to estimate the numbers. Titled ‘Top of the Pyramid 2017’, it’s the seventh edition of this annual publication.Interestingly, the study noted that Indians were getting wealthier at a younger age. “About 60 per cent of ultra HNIs surveyed for the report are below 40 years as against 47 per cent interviewed in the earlier edition,” the report noted. Emergence of a large number of this crowd of young super-rich is due to family inheritance, said Jaideep Hansraj, CEO, Kotak Wealth Management & Priority Banking.
Speaking about the current market trend, Hansraj expected investors would prefer to move their investments into debt-market products, as equity markets were “crazy” since the past fortnight. Talking about investors’ preference for physical assets, Hansraj said that he did not expect investors to return to park their money in gold and real estate. However, investors’ preference for financial assets, which was boosted by the demonetisation in November 2016, would continue, he added.