Over the next four years, Karvy Wealth expects the total wealth of Indian individuals to double from current levels. At present, in the current fiscal, the wealth wealth held by individuals here is Rs 92.26 lakh crore. This is a 6.7 % increase over the previous fiscal.
According to a recent report by Karvy Wealth, the proportion of debt held by Indian have gone up from 67.9 % to 72.3 %. And predictably, the proportion of equity has dropped to 27.4 % from 31.8 % in the previous fiscal.
Ultra High Networth Individuals and the mass affluent class (totalling 21.2 million households) account for 60-70 % of the entire wealth held by individuals, Karvy said.
The report states that proportion of direct equities in investors’ portfolios have fallen nine % during this fiscal. Retail investors hold 12.79 % (Rs 9.62 lakh crore) of the total market capitalization during the fiscal current fiscal.
Investments in debt have increased thanks to the lackluster performance of equities for the last year. It is only in the last two months that there has been a spurt in equities.
“Given the global economic uncertainties and persistent high inflation in Indian, many investors stayed away from equities and have shifted to debt instruments”, said Hrishikesh Parandekar, CEO & Group Head (Broking, Wealth Management and Asset Management), Karvy.
He also added that the investment in debt was further boosted by deregulation of savings bank deposit rate and increasing small savings returns.
Karvy Wealth expect investments in direct equity to form more than 28 % of the total assets by the fiscal year 2012. Alternate assets like structured products, private equity, venture capital funds, gold Exchange Traded Funds are expected to grow more than three times during his time.