In recent years, India has emerged as a hotspot for ultra high net worth individuals (UHNWIs) globally. According to consultancy Knight Frank, the country is expected to witness the fastest growth in UHNWIs over the next few years. This surge in wealth has positioned India’s financial center, Mumbai, as Asia’s leading billionaire hub, surpassing Beijing. The city ranks third in the world in terms of billionaire count, following New York and London. The ultra-wealthy population in India, individuals with a net worth of at least $30 million, saw a 6.1% increase to reach 13,263 in 2023. Knight Frank predicts a staggering 50.1% growth in UHNWIs in India by 2028, marking the fastest expansion globally.
Investment Preferences of India’s Ultra-Rich
Luxury real estate has been a significant focus for India’s UHNWIs when it comes to investment. Approximately 30% of their investments are directed towards luxury real estate, including overseas projects. The shift from investing in land to residential real estate has been driven by the liquidity of the asset, especially in the wake of the pandemic. On average, an UHNW Indian owns more than two homes, with around 12% of super-rich individuals planning to purchase a new house in 2024. The interest in offshore investments has also witnessed a notable increase among Indians, leading them to diversify their assets globally.
Indian ultra-rich individuals are increasingly looking at expensive real estate investments abroad, with Dubai being a preferred destination. Indian investors own around 20% of Dubai’s offshore real estate market, drawn to the city’s cosmopolitan lifestyle and amenities. The luxurious residential properties overseas serve as vacation homes, rental properties, or opportunities for resale. The allure of offshore investments has been fueled by the desire for global exposure and asset diversification.
Startup investments have gained prominence among India’s wealthy populace, particularly the younger generation. Many young Indians, having studied abroad, are inclined towards investing in startups upon returning to India. The startup ecosystem in the country has witnessed significant growth, with sectors like fintech, healthcare, and technology attracting substantial investments. This dynamic investment strategy not only offers diversification in the portfolio but also positions UHNW individuals to capture significant returns from high-growth sectors.
Consumer goods startups are becoming an attractive investment avenue for India’s ultra-rich, driven by the country’s growing consumer market. The rise in middle to high-income households is expected to catapult India to the world’s third-largest consumer market by 2027. Amid this backdrop, India is projected to see a substantial increase in startups and unicorns by 2030, reflecting the evolving investment landscape. Additionally, UHNW individuals are actively exploring alternative investment opportunities, with luxury items such as jewelry, art, and watches holding cultural significance and offering personal enjoyment along with appreciation in value.
Equities continue to be a favored asset class for India’s wealthy investors due to their potential for high returns. Blue-chip stocks, high-growth mid-cap companies, and sector-specific investments in industries like pharmaceuticals and technology are among the key areas of interest for UHNW individuals. The upward trajectory of the Indian markets, driven by GDP growth and liquidity inflows, has further bolstered the appeal of equities as a wealth creation tool.
India’s ultra-rich are navigating through a diverse set of investment options, ranging from luxury real estate and startups to consumer goods and equities. With a keen eye on global opportunities and a penchant for alternative investments, India’s UHNWIs are redefining wealth management strategies to capitalize on emerging trends and maximize returns.
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