In an interview with ETMarkets, Mathur said: “To make money, you don’t need to be the most intelligent person in the world; you just need to be disciplined. All asset classes offer sufficient wealth creation opportunities” Edited excerpts:
Let me start off with the overall industry because we are talking about wealth management today. How has the industry changed, let’s say, in the last four to five years, and what is the outlook that you see in the next few years?
So, basically what I feel has changed drastically over the last couple of years, probably post-COVID, is that a lot of trends have shifted. Now, if you look at the overall industry, either wealth or retail, some interesting trends have emerged.One is definitely data consumption. We all know that we are a young population. Our average age is 28, and the kind of data we are using is phenomenal. The average Indian uses close to 20-plus GB a month, which is quite amazing.
So, one important factor in India is that we are a country with a young population. We have almost 65 crore-plus smartphone users, almost 75 crore people have access to the internet, and 100 crore-plus have mobile phone connections. So, these are important indicators of where the industry is moving—towards data consumption.
The second important factor that has changed, according to me, is digitalisation. We all know the impact digitalisation has had, especially with new accounts being opened. Recent news articles clearly showcase what Jan Dhan and UPI have accomplished.
About five years ago, we had 4 crore Demat accounts; now, we’re talking about 16 crore Demat accounts. We’re also seeing new mutual fund folios and new mutual fund AUMs being added. So, digitalisation and the ease of doing transactions have reached a different level.
The third major trend I’ve noticed is innovation. Globally, I think we’re the third-largest ecosystem in terms of startups, with almost 1,10,000 companies registered as startups in India and over 2,000 fintechs. This is phenomenal.
We have new startups and an account aggregation model. Recently, the RBI governor talked about three important initiatives: JAM, UPI, and the recent buzz of the town, ULI. All of this is now coming fast and thick.
The fourth major factor where I’ve seen disruption is policy. The government is doing all sorts of things to keep things rolling. For instance, we see investment in infrastructure, rural economies, and an increase in per capita income. We are absolutely going in the right direction.
A classic example is Jan Dhan, where we have 53 crore Jan Dhan accounts with an average balance of over Rs 4,000. This is quite interesting.
On the positive side, these are the three or four major trends I see. At the same time, what I’ve observed recently—and this isn’t over the last five or six years, but quite recent—is the FOMO effect.
We all know what has happened with some of the IPOs recently. Out of 152 SME IPOs, I saw data that showed almost 200 times oversubscription. Even with main board IPOs, the oversubscription is 40 times plus.
But having said that, we’re moving in the right direction. I personally believe we are in a structural, multi-decade bull run. It is India’s time, and that’s where the ultimate money follows the value. So, HNIs and retail investors are in the right place at the right time.
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Because there’s so much liquidity, as we discussed, it also means there are a lot of HNIs and ultra-HNIs, which is contributing to the kind of liquidity we’re seeing in the market. So, how are HNIs and ultra-HNIs looking to invest, not just in the domestic market but in the global market, to diversify their portfolios?
So, basically, HNI clients are an evolved lot. They are HNIs because they have earned their wealth over time. They know how to make money and understand the true value of it.
They are agnostic to asset classes, from what I’ve seen. Recent data suggests they are investing in real estate, with almost 8,500 properties being sold for over Rs 4 crore, which is 27%.
We keep seeing advertisements in newspapers that say “sold out” or “you missed the bus,” so to speak.
This is quite interesting because if we talk about properties above one crore, almost 41% of the market is captured by this segment. We used to talk about affordable housing, but 41% above one crore is not affordable housing.
So, this is one area, like real estate, where they are investing. Even in equities, they are increasing their allocation. Almost 3% plus of the entire mutual fund corpus is with HNIs. They are also investing in the startup ecosystem.
We all know that whether it’s pre-seed, pre-revenue, they are more than keen. In alternates, over the last 10 years, the commitment is more than 11 lakh crores, so that is where the money is moving.
Across all asset classes—equity, currency, commodities, real estate, and alternates—they are just chasing value, agnostic to a particular asset class. And they are the smartest lot.
Since you touched on global investments, I have noticed that the dollar itself has historically provided an edge over the rupee, and with digitalisation, people are now aware of what’s happening with companies like Nvidia, Snowflake, and others.
So, people are looking at options and flavours, especially HNIs, UHNIs, and VHNIs. They are looking at alternates, and that’s where they are investing globally.
Predominantly, I’ve seen two or three markets where the major chunk goes, and the U.S. is one of them. On the real estate side, I’ve seen people moving towards London, Dubai, and Abu Dhabi, so that’s where the money and the overall assets of HNIs are going.
So, we talked about all the traditional asset classes like real estate and equity. Let’s also get your viewpoint on whether these affluent investors are looking at art, wine, and watches as investment options. While I’m not sure how Indian trends are shaping up, globally they certainly are.
Absolutely. This entire asset class of passion investments is extremely interesting—whether we talk about art, whiskey, or wine. Around 17% of ultra-HNIs’ net worth is in this asset class because it provides a different kind of satisfaction.
I can’t showcase my vintage shares, but I can showcase my vintage car or my vintage whiskey, and I can enjoy it with my family and friends. These types of assets offer a unique kind of enjoyment.
The good part is that this market is evolving; globally, it has already evolved. Over the last 10 years, vintage whiskeys have given a 280% absolute return, art has provided around 105% returns, and watches have returned close to 130% plus. This is comparable to the 10-year CAGR of equity or gold.
It’s also interesting to note that in India, over the last two years, the top 10 art deals occurred during this period, with single pieces going for around 40 crores, such as works by Gaitonde. Raja Ravi Varma’s art sold for close to 30–35 crores.
So, people are now getting into this market because it provides that kind of satisfaction for clients who are extremely evolved. As I mentioned, they know where the value is, whether in art, equity, or currency.
Let’s also narrow it down to a certain extent. If we’re talking about affluent investors, have you noticed any investment trends among celebrities or influencers? Some influencers have become HNIs due to the kind of money they are earning, and I’m sure they also fall under the ultra-rich category. Could you share your viewpoint on that?
Over the last eight to ten years, I’ve noticed that celebrities, the so-called most sought-after individuals, have evolved as well. They are managing their wealth beautifully, either by assigning it to wealth management outfits or by running their own family offices, and it’s quite evident.
For example, I was reading an article today about a celebrity who recently entered the Hurun list. So, that’s what’s happening. These celebrities understand that glamour only lasts for a while, but wealth matters in the long term. They are on the right track.
I’ve seen many celebrities who are extremely evolved and knowledgeable. They understand what they are doing and know how and where to invest.
Now, let’s also talk a little bit about Gen Z, the new-age investors who have just joined the party, or you could say, the party on D-Street. What difference are they bringing to the table? They seem more evolved in the way they approach things, and if I take my own example, I probably wasn’t as evolved when I was their age—maybe because the internet wasn’t as widespread back then as it is now. So, how are the next generation of investors, or Gen Z, managing wealth, and what trends are you spotting there?
I’m also learning from my daughter, who is part of Gen Z—the so-called Zoomers. Some of the technology and terms I’ve heard are completely new to me, like YOLO, FOMO, and FOLO. I’ve been in the financial market for 22 years, and suddenly someone is talking about “You Only Live Once,” so enjoy.
They are the digitally native generation, and as we know, a significant portion of India’s population is Gen Z. Frankly, they don’t want to be taught; they are the ones using data, YouTube, and finfluencers.
They are the ones investing in cryptos and tokens, and they are aware of everything. You don’t need to teach them—that’s something I’ve personally observed.
The good part is that almost 50–55% of new investments coming through mutual fund folios or new Demat accounts are from these Gen Z individuals. They understand what investing is and what activity means.
Now, it’s just a matter of reaching that point of maturity where they realize the difference between activity and disciplined investment, which involves asset classes and discipline while cutting through the noise.
I’m sure they are evolving, and they are the smartest generation we’ve seen. Around 80–85% of Gen Zs are already investing.
As you rightly mentioned, we didn’t think of investing until we were 23 or 24, but my daughter, who is 18, is talking about trends, charts, and cryptos. It’s a different breed, and I’m very happy to see it for our country.
Let me also get your viewpoint. Let’s say someone wants to invest 50 lakhs—where should they look at investing in the current market scenario, given that we touched fresh record highs in today’s trading session? Should they consider PMS, mutual funds, real estate, global investments, or alternate investments? What are your views?
You’re asking this question to the wrong person; I’m a 100% equity guy. But yes, you are right that ultimately it all boils down to discipline, asset allocation, and cutting the noise.
To make money, you don’t need to be the most intelligent person in the world; you just need to be disciplined. All asset classes offer sufficient wealth creation opportunities.
Specifically, if I were to invest today, my decision would depend on several factors like my profile, age, goals, how evolved I am, and what kind of income stream I’m generating.
Is this 50 lakh corpus for my retirement, or do I want to grow it? Do I want to preserve it or grow it? If it’s a retirement corpus, it would go into fixed-income papers, but if it’s for investment, I’m a firm believer in the Indian economy.
I’d put 100% into indices and equities because, in my opinion, Indian indices are the best fund managers. So, I would shut my eyes and invest there…
To buy the ETF, yes?
Absolutely, ETFs and index funds offer phenomenal returns.
There is another point I wanted to highlight, which often gets missed in many conversations. When someone starts working and begins investing, how important is it for them to plan for contingencies? This is something that investors, especially at an early stage, often ignore.
Absolutely right, you’re spot on. This is one aspect—contingencies—that, if they hit, hit us exponentially hard. It’s extremely bad because something unforeseen, if it strikes and I haven’t made provisions for it, can be a disaster in any form.
What I’ve observed is that these days, most companies and corporates are actively provisioning for all kinds of contingencies, including natural disasters, through their BCPs (Business Continuity Plans).
However, when it comes to individual contingencies—whether related to health, income loss, or life loss—the penetration in India is only 4%, with 3% in life insurance and 1% in general insurance.
We are a highly under-penetrated market. We insure our vehicles, whether two-wheelers or four-wheelers, because it’s a regulatory requirement, but we often neglect to insure ourselves. It’s extremely important.
In fact, wealth management should start with preserving what I have, and only then can I look at growing it. This is a very important aspect.
(Disclaimer: Recommendations, suggestions, views, and opinions given by experts are their own. These do not represent the views of the Economic Times)