New Delhi, Dec 17, 2014: Key Highlights
~ The total Indian Individual Wealth in FY14 is estimated to be at ` 257.4 Lakh Crore, an increase of 27.5% over FY13.
~ The Wealth Held by individuals in Financial Assets has grown by 84% over the last 5 years.
~ Indian individual wealth is expected to grow at a CAGR of 14.9% and double over the next 5 years. Wealth held by individuals in financial assets is expected to double in next 4 years at a CAGR of 18.3%. Wealth in physical assets is expected to grow at a CAGR of 10% in the next five years.
~ The new government has undertaken a lot of initiatives to revive the Indian economy and make it among the fastest growing economies in the world. The economy is expected to reach a GDP growth rate of 7.5% by 2018.
~ Direct Equity will become the single largest asset class contributing to individual wealth in India in FY15 overtaking fixed deposits and is likely to remain there. We expect a 25% CAGR on the equity markets and look at the Sensex touching 1,00,000 level by 2020!
KARVY Private Wealth , the wealth management arm of the KARVY Group, a leading financial-services conglomerate, launched its 5th edition of India Wealth Report today. The report provides an overall perspective on wealth held by individuals in India across financial assets and physical assets (Real Estate, Gold, Diamond, Silver and Platinum).
As on end of FY14, total individual wealth in India stands at `257.4 Lakh Crore an increase of 27.5% over FY13. The total wealth held by Indian individuals in financial assets stands at `134.7 Lakh Crore (52.3%) and in physical assets stands at `122.7 Lakh Crore (47.7%).
The wealth held by individuals in financial assets has grown by 84% in the last 5 years at a CAGR of 13%. Considering the fact that the economy (Indian and Global) had not shown healthy growth in this period, this gives an indication of how wealth will grow when the Indian economy does well in the next 5 years.
The Indian economy is expected to reach a GDP growth rate of 7.5% by 2018. Due to macro- economic revival, we are seeing possibly the beginning of biggest bull runs in India. Direct Equity will become the single largest asset class contributing to individual wealth in India in year ending March 2015 overtaking Fixed Deposits and is likely to remain there. We expect a 25% CAGR on the equity markets and look at the Sensex touching 1,00,000 level by 2020!
Overall Indian individual wealth is expected to grow at a CAGR of 14.9% and double over the next 5 years. Wealth held by individual in financial assets is expected to double in next 4 years at a CAGR of 18.3%. Wealth in physical asset is also expected to grow at a CAGR of 10% in the five years.
Classification of Individual Wealth in India based on Financial Assets:
|
Asset Type |
Amount (` Cr.) |
FY14 Proportion (%) |
|
Fixed Deposits and Bonds |
29,39,702 |
21.82 |
|
Direct Equity |
26,66,202 |
19.79 |
|
Insurance |
22,12,654 |
16.43 |
|
Savings Deposits |
16,28,628 |
12.09 |
|
Cash |
13,00,900 |
9.66 |
|
Provident Fund |
7,36,096 |
5.46 |
|
NRI Deposits |
6,22,337 |
4.62 |
|
Small Savings |
5,78,851 |
4.30 |
|
Mutual Funds |
3,93,140 |
2.92 |
|
Current Deposits |
3,08,125 |
2.29 |
|
Pension Funds |
48,136 |
0.36 |
|
Alternative Assets |
23,727 |
0.18 |
|
International Financial Assets |
12,659 |
0.09 |
|
Total |
134,71,160 |
100% |
Classification of Individual Wealth in India based on Physical Assets:
|
Asset Type |
Amount (` Cr.) |
FY14 Proportion (%) |
|
Gold |
62,53,263 |
50.96 |
|
Real Estate |
50,38,978 |
41.07 |
|
Diamond |
7,77,084 |
6.33 |
|
Silver |
1,95,498 |
1.59 |
|
Platinum |
5,678 |
0.05 |
|
Total |
122,70,501 |
100% |
Commenting on the occasion, Mr. Sunil Mishra, CEO – KARVY Private Wealth, said, “ Wealth with individual investors is expected to grow more rapidly in the next five years, riding on faster growth of the economy. The new government has undertaken a lot of initiatives to revive the Indian economy and make it among the fastest growing economies in the world. Several new policy measures like Make in India, Development of 100 Smart Cities, opening of FDI in several sectors, Swachh Bharat Abhiyan, Free pricing of auto fuels, financial inclusion by banking the unbanked etc. will also go a long way in making India more competitive and productive.
We are standing at an interesting juncture where we are going to see a trend reversal between share of HH savings going into Financial Assets vs Physical Assets. This will change from 69:31 in favour of physical assets to 50:50, over the next five years .”
