Friday, January 1, 2016

Indian HNIs wealth will double in 5 years

With 1.98 lakh HNIs, India now ranks 11th in the world HNI population.

The overall HNI wealth in India has grown by 28% as against a global HNI wealth growth of only 12% last year. With 1.98 lakh HNIs, India now ranks 11th in the world HNI population, shows the latest Karvy Wealth Report.

Also, the total wealth held by individuals in India has grown by 8.9% to Rs. 280 lakh crore in 2015.

Karvy defines HNIs as individuals having investible assets of $1 million and more excluding primary residence, collectibles and consumer durables.

The high net worth individual (HNI) population in Asia Pacific grew at the fastest pace globally, pipping North America which had the most HNIs so far.

The number of high net worth individuals (HNI) grew in both number and wealth to 14.6 million and $56.4 trillion respectively.

Ultra high net worth individuals (UHNIs) who make only 1% of all HNIs contribute roughly 35% of the wealth continued to remain the key drivers of the global HNI population. The UHNI population grew by 8.6% in 2014. UHNI are individuals having US$30 million or more investible wealth.

Asset allocation

In spite of low interest rates, the allocation of the global wealth across asset classes shows that debt remained the biggest investment vehicle signifying lower risk appetite of investors.

Global wealth across key asset classes

While a majority (43%) of investments was held in debt, the appetite for equities increased around the world. The global asset allocation in equities grew to 26.8% in 2015 compared to 24.8% last year.

Allocation to real estate reduced to 17.6% from 18.7% last year.

Individual investors are taking a shine to financial assets. The total individual wealth in financial assets has increased from Rs. 134 lakh crore in 2014 to Rs.160 lakh crore in 2015shows Karvy Wealth Report 2015.

In fact there has been a significant growth in individual financial assets in the last five years. Individual wealth in financial assets have grown from Rs. 73 lakh crore in 2010 to Rs.160 lakh crore in 2015.
Karvy predicts that this wealth will double from the current Rs. 160 lakh crore to Rs. 326 lakh crore in the next five years. 
The study shows that financial assets which had a share of only around 35% of the new money invested in the last year now have as much as 54% share of the allocation of incremental savings and investments.

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