Where are India's super-rich investing their wealth?

India’s richest still choose real estate and gold to park their wealth, according to a report by the global equity research and brokerage firm Bernstein. There is also growing wealth inequality in the country.

The top one per cent holds 60 per cent of India’s wealth. The firm also pointed out that the rich will keep on becoming wealthier due to this highly concentrated nature of household wealth.

Let’s take a closer look.

How India’s uber-wealthy split their wealth

About 60 per cent of the wealth possessed by India’s uber-rich is held in real estate and gold, ANI reported, citing Bernstein.

The uber-rich includes Ultra High Net Worth Individuals (UHNI), High Net Worth Individuals (HNI), and the affluent class.

As per the report, India’s wealthiest own around $2.7 trillion in serviceable assets, while approximately 60 per cent of wealth is still parked in real estate and gold.

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India’s total household assets are valued at $19.6 trillion, of which 59 per cent or $11.6 trillion is held by the uber-rich.

This top wealth bracket makes up for just one per cent of Indian households. However, they own 60 per cent of the total assets and 70 per cent of the financial assets of the country.

About $8.9 trillion owned by India’s wealthiest is in the form of non-serviceable assets such as physical real estate, gold, promoter equity, and currency assets. These are traditionally not managed by wealth managers or are harder to reallocate.

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Just $2.7 trillion of the wealth owned by India’s richest is held in serviceable financial assets like direct equity, mutual funds , insurance, and bank or government deposits, as per Bernstein.

India’s uber-rich

There are around 35,000 Ultra High Net Worth Individuals in India with a net worth of more than $12 million.

The average income of these uber-rich households is $4.8 million, and they have average assets of $54 million, including $24 million in financial assets.

Combined, India’s richest own $4.5 trillion in financial assets, nearly 70 per cent of the total financial assets.

The firm also mentioned that there is a growing opportunity for Indian wealth managers, particularly in providing services to the country’s ultra-wealthy households.

“With rising return expectations and product complexity, demand for professional advice is growing. We see specialised wealth managers benefiting, with a long growth runway. We expect specialised wealth managers to expand from $300 billion in assets under management (11 per cent share) to $1.6 trillion over the next decade, implying an 18 per cent+ CAGR,” said Bernstein.

India’s wealth disparity

According to the report, while income disparity in India is notable, wealth disparity is even more prominent.

The top one per cent earns 40 per cent of all income, while the rest hold a small portion of both income and assets.

As per a study, the income inequality in India is among the highest in the world, even starker than the United States, Brazil, and South Africa.

“Although growth will continue to create opportunities across the pyramid, we think the rich will get richer. India’s uber-rich – an estimated nearly three million households – hold $2.7 trillion in liquid financial wealth, by our estimates,” said Bernstein.

India has 284 billionaires, with 13 new joining the elite club in 2024 alone, according to this year’s Hurun Global Rich List.

With inputs from agencies