top of the pyramid

Presentation Flow

► The Report

► Key findings and insights

► Spends

► Investments

About the Report

► Top of the Pyramid 2015 compiles insights into the profile of Indian ultra HNIs,

lifestyle and investment patterns

► The report carries a theme which reflects the sentiments of the ultra HNIs

interviewed, along with experiences shared by luxury brands and service

providers

► This year’s theme ‘Gliding on Optimism’ presents some captivating insights that

follow the new government’s confidence-boosting measures and hopes of a strong

economic recovery

► The report also covers

► Luxury Weddings, Foreign Education for Children and Real Estate in the special focus

section

► Growth stories of notable first-generation entrepreneurs of e-commerce companies - Just

Dial’s VSS Mani, Bharat Matrimony’s Murugavel Janakiraman, Carwale’s Mohit Dubey

and Jabong’s Praveen Sinha

Key findings and insights

Gliding on Optimism

► Improvement in economic sentiments led by new government’s

confidence-boosting measures and hopes of a strong economic recovery

► Increase in investments into businesses

► Increase in spending on both discretionary and non-discretionary

categories

► Increase in exposure to equity as an asset class

Introduction Spends Investments

Ultra HNHs grow by 17 per cent

► Ultra-High-Networth Households (HNHs)

increased to 137,100 in 2014-15 from

117,000 in 2013-14

► Accumulated networth of Rs. 128 trillion

(2014-15)

► Emergence of ultra HNIs in high growth

sectors such as e-commerce and

logistics


Wealth projections

► Growth projected in the number of

Ultra HNHs and net worth by 2019-20:

► 348,000 ultra HNHs

► Corresponding networth of

Rs. 415 trillion


City Focus – Lifestyle preferences

► Chandigarh ultra HNIs have

higher spends at 45% of

overall income

► Ahmedabad ultra HNIs have a

higher proportion of

discretionary expenses at

19%

► Chennai ultra HNIs have a

higher proportion of income

allocated for Charity at 9%

compared to national average


City Focus – Investment preferences

► Chandigarh ultra HNIs prefer physical

assets over financial assets with 54% of

their investments going towards Real

estate

► Ahmedabad ultra HNIs prefer financial

assets over physical assets

► Chennai ultra HNIs are inclined towards

investments in alternate assets such as

gold


9

How the Ultra HNIs

Spend

High allocation towards spends and

primary business

► Income allocation towards spends and

primary business is maximum at 40%

and 22%

► 62% of ultra HNIs have upped their

investments into primary business and

as many as 45% have increased their

personal investments

► With lower inflation and interest rates, ultra

HNIs allocate major part of their income

towards spends


The emergence of e-commerce has disrupted the lifestyle and spending habits of ultra HNIs whereby

they increasingly avail the option of shopping for luxury items through a click of their mouse

Online shopping picks up with the boom in

the e-Commerce sector

► Digital usage of ultra-rich is majorly around

instant messaging, mails, and social

networks

► 88% of professionals have their digital

preferences inclined towards spending time

with social circle

► As many as 66% of entrepreneurs and

inheritors spend time planning events with

their social circle

► One that has hit India only recently is an

‘invite only’ network open to select people

► Recently, a Bollywood star announced, at

a launch party in India, an exclusive

international private travel and lifestyle

club, famous among the ultra-rich abroad.

Special social networks are emerging


Philanthropy focus: Education, Healthcare

are preferred causes

► Ultra HNIs’ philanthropic spends remained largely unplanned

► Education and healthcare are the most supported causes in philanthropy

► These causes might get a push with the reforms planned by the government with policies like

Beti Bachao, Beti Padhao; National Health Assurance Mission


Analog watches preferred but the trend

of smart watches is catching on

► An Indian luxury watchmaker is creating

watches using coins of historical importance

which can be passed down through

generations as heirlooms

Bespoke handcrafted watches is gaining

ground in India

► With at least 38% ultra HNIs preferring

them, analog watches remain first

choice for most occasions

► There’s a gradual shift expected towards

smart watches

► Association with prominent personalities

are used to create brand awareness and

an aura of exclusivity

► The most expensive variant of a smart

watch launched by a leading technology

company costs over INR 10 lakh


Special Focus:

Luxury Weddings

Preference is for destination weddings


► As many as 77% of ultra HNIs prefer India as a wedding destination

► Thailand, France and Spain are becoming highly sought-after wedding locations

Deciding location and theme are the

primary activities

► Ultra HNIs spend maximum time on

deciding location (5.8 months) and

theme (5.6 months)

► About 5-7 months of planning goes

into planning a luxury wedding

► 47% and 40% of ultra HNIs prefer

Traditional and Royal themes for

luxury weddings


► Along with wedding invites, a Delhi

businessman sent out monogrammed

wallets for men and scarves for

women, sourced from international

luxury brands, each worth Rs 35,000-

80,000

Personalization is key in case of

weddings

Focus is on exquisite cuisine and

locationIntroduction Spends Investments

► Exquisite cuisine is a priority for 87% of ultra HNIs

followed by wedding location for 74%

► While traditional Indian food is the bare minimum,

fusion food is one of the hottest trends

► Leading brands are increasingly approaching ultra

HNIs with proposals for customized gifts

► A leading industrialist took 30-40 chefs

and ingredients from India to Barcelona

for his daughter’s wedding, to get the

taste just right!

Most ultra HNIs are seasoned globetrotters

who have sampled world cuisines

Special Focus:

Foreign Education

US and UK are first choice for foreign

education destinationsIntroduction Spends Investments

► All-round development and emphasis that

contemporaries make are drivers for foreign

education

► Exposure to business environment and

networking are additional motivations

► 26% and 19% of ultra HNIs have USA and UK

as preferred destinations for foreign education

for children due to distinguished institutes and

high quality of education

► Quality of education, global exposure, and

safety are the key drivers when it comes to

choice of country

Under graduation starting point; Career

choice: Family business, consulting firms

► Academic spends, on an average.

constitute 65% of expenses

► 35% and 40% of children of

entrepreneurs and inheritors prefer

joining the family business after

foreign education

► 33% of children of professionals

join a consulting major post foreign

education

► The courses provide networking

opportunities to young adults to take

their businesses to next level with right

collaborations

Global business school have started

tailor-made programs for running family-

managed business


How the Ultra

HNIs Invest

Key wealth drivers: Success in business

and Real estate

► Real estate and success in business

have contributed to wealth of 64% of ultra

HNIs over the years

► Entrepreneurs and Inheritors lay higher

emphasis on their primary business

► 66% of professionals get most of their

wealth from personal income (includes

their salary), and real estate


Online portals preferred to track

investments

► 74% of ultra HNIs use investment portals to track investments; this is a result of the online

boom

► Traditional investments tracking through wealth management reports is still also a popular

option with 70% of ultra HNI using them

► Websites, television and mobile applications largely play a supporting role


Exposure to equity increases at the cost

of debt and real estate

► Equity allocation has increased to 45% in

FY15 with a consequential reduction in debt

to 20% and real estate to 25%.

► This is due to increased returns from equity

markets with expectations of reform from the

new government

► In equity markets, over 50% of ultra HNIs

preferred Banking and Infrastructure sectors

in FY15

► Around 50% have shown preference for mid

cap companies in FY15

► Despite the slowdown in real estate, 68% of

ultra HNIs are optimistic about real estate

sector in the future


Special Focus:

Real Estate

Investments

Real Estate: Reliable investment for the

long term

► Over 90% of ultra HNIs have exposure

to real estate

► Ultra HNIs rely on expert investment

advice and self-analysis for real estate

investments

► As many as 48% prefer residential

properties followed by commercial

properties

► Ultra HNIs display a growing preference

for commercial real estate driven by

higher rental realization compared to

residential market


Non-metros and other towns preferred


► Non-metro cities and other towns are

preferred by 75% of ultra HNIs for real

estate investments

► Ultra HNIs usually purchase real estate

overseas either to make second homes

in cities they frequent for business or as

holiday homes

► Metros: Delhi, Mumbai, Chennai, Kolkata

► Non-metros: Bengaluru, Ahmedabad, Pune,

Nagpur, Ludhiana, Hyderabad

► Others: include all other cities

► There is a growing trend of ultra HNIs buying

blocks of apartments and row houses

allowing them to earn a stable rental yield

There are new avenues of real estate

investments made by ultra HNIs

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