India's Ultra-Rich To Rise By 58.4% In Next 3 Years: Report

High-net-worth individuals (HNWIs) in India are characterised by substantial incomes, luxury possessions, and diverse assets. As of now, Gautam Adani holds the distinction of being the wealthiest individual in India. The recently released Wealth Report 2023 by Knight Frank reveals that an individual needs a net worth of Rs 1.45 crore to enter the top 1% of HNWIs in the country.

Media reports suggest that, particularly in the financial sector, individuals can be classified as HNWIs if they possess an investment amount of Rs 5 crore, exclusive of their existing holdings and assets. Generally, HNWIs include business owners, high-ranking corporate executives, individuals who have inherited substantial wealth, and emerging entrepreneurs.

There are three categories within the HNI spectrum. The first comprises High Net Worth Individuals (HNWI), whose investable amounts range from Rs 5 lakh to Rs 5 crore. Following this, Very High Net Worth Individuals (VHNWI) are those with investable amounts ranging from Rs 5 crore to Rs 25 crore. The third category consists of Ultra High Net Worth Individuals (UHNWI) with investment amounts exceeding Rs 25 crore, separate from their existing holdings.

HNWIs have a plethora of investment options, with equity being a preferred choice. They often opt for the stock market and related investment instruments for higher returns. Additionally, HNWIs invest in hedge funds and allocate substantial amounts to real estate, art, and collectables.

According to Knight Frank’s latest report, India’s UHNWIs, individuals with a net worth of over Rs 2.49 billion, are projected to grow by 58.4% by 2027. The report indicates that in 2022, there were 12,069 Ultra High Net Worth Individuals in India. Shishir Baijal, Chairman and Managing Director of Knight Frank India, attributes this growth to India’s dynamic development activities in both core and non-core sectors, contributing to accelerated economic growth. Furthermore, India’s prominent position as a global startup hub has played a pivotal role in the creation of new high-net-worth individuals.

As the landscape of wealth in India continues to evolve, the criteria for defining and categorising HNWIs provide insights into the changing dynamics of wealth accumulation and investment preferences in the country.