Even though 2022 was marred by an extended era of instability and insecurity, 88% or nearly 9 out of 10 Indian ultra-high-net-worth individuals (UHNWIs) saw their wealth grow during that year. This is according to Knight Frank’s latest report – The Wealth Report: Outlook 2023.
Almost 35 percent of Indian UHNWIs saw their net value increase by at least 10% in 2022. Bonds, real estate, and equities together accounted for the majority of the wealth invested by UHNWIs.
Unsurprisingly equities made up the largest portion of investable wealth in 2022, whilst Commercial property predictably followed in second. Just over 10% of UHNWIs’ investable wealth was allocated to bonds as a way to find stability in an uncertain environment.
The expansion of commercial assets such as property was an indication of increased investor confidence in India’s economy and future.
Knight Frank also predicted that in 2023, the wealth of the ultra-wealthy would continue to rise. With the vast majority of UHNWIs expecting to see their wealth expand by a minimum of 10% again.
“With 69% of UHNWIs expecting to see wealth growth in 2023 – we are anticipating a substantial shift in portfolio strategy – with a search for value opportunities in the real estate sector playing a much bigger role than in recent years. Downward pressure on property values, due to higher interest rates, has created a window for private capital – especially as we enter this new market phase with historic lows in terms of the stock of best-in-class property in residential and commercial markets,” said Liam Bailey, Global Head of Research at Knight Frank.
In addition, a percentage of Indian UHNWIs are anticipated to seek passion-driven assets rather than financial instruments – According to an attitudes survey by Knight Frank.
Note: Most respondents have showcased interest in more than one passion led Investment Avenue Source: Knight Frank Research
In 2023, 53% of UHNWIs are expected to spend on art, watches, fine wine, and high-end handbags, which continue to be the most popular investments of passion. The other most sought-after passion-driven investments for 2023 are vintage automobiles, rare whisky, and furnishings.
Source: Knight Frank
