Individual wealth in the country is likely to double to Rs 411 lakh crore in the next five years from the current Rs 202 lakh crore due to a surge in the overall economic growth in India, says a report.
Even though the country is growing at five per cent at present, the GDP growth rate will increase to six and 6.5 per cent in the coming years on the back of new government coming to power and as the effects of the recent reforms sets in, according to the report released today by Karvy Private Wealth.
The ratio of wealth between financial and the physical assets will remain unchanged at the current level of around 55:45 but there will be some shift in the assets within them, Karvy Private Wealth's Chief Executive Sunil Mishra told reporters after launching the report here.
Due to an expected surge in markets, especially post elections, direct equity investments within financial investments is expected to grow to 28 per cent from the present 22 per cent while insurance will also rise marginally to 19 per cent, he said adding that these gains will come on the back of reductions in savings deposits, fixed deposits and cash.
On the physical assets front, Karvy expects the composition of gold to go down to 22 per cent from the current 30 per cent while real estate increase rapidly as people invest in second, third and fourth homes, he said.
"Real estate becomes an investment only with the purchase of second home and right now, data suggests that 86 per cent of Indians have their own home. So as more and more people start having their own homes, we will see a greater number of investments," Mishra explained.
This will lead to the ratio in the physical assets between gold and realty to shift to 52:48 from the present 65:35, he said.
"The investment in real estate is going to double in the next three years," he said.