HNI wealth

Even as capital markets remain buoyant on the back of strong FII inflows, the wealth and number of high networth individuals (HNIs) in the country is now back to the pre-crisis level, according to a latest wealth report. India and Hong Kong, which experienced the world’s largest declines in HNI population and wealth in 2008, showed the strongest resurgence in wealth generation in 2009. The HNI population grew 104.4% in Hong Kong and 50.9% in India, according to the Asia-Pacific wealth report for 2010 by Merrill Lynch Global Wealth Management and Capgemini. HNI wealth in India jumped 53.8% to $477 billion in 2009. Only Hong Kong, where HNI wealth surged 108.9%, did better in Asia-Pacific.India’s HNI population is now level with that of South Korea after dropping in 2008. HNIs from China and India allocated a very high 85% and 82%, respectively, to home region investments. In contrast, Japanese HNIs maintained a fairly diversified portfolio, the report said. India’s HNIs were driven to invest in equities by rising asset values and signs of underlying economic growth, it noted. The combined market capitalization of the NSE and the BSE more than doubled to end 2009 at $2.55 trillion. China and India will lead the way in the region with economic expansion and HNI growth in these countries is likely to outpace more developed economies.The super rich are moving away from equities, mutual funds and FDs and channelling their wealth to start-ups, unlisted companies, realty-focused private equity funds, gold ETFs and art.