India, The $1 Trillion Market – Survey

Christopher Owen

4 January 2008

India is slated to become a $1 trillion market in assets under management for wealth management providers by 2012, with a target market size of 42 million households. Providers, products, channels, technology, regulation, and clients are currently coming together in the wealth management space to capitalise on this tremendous growth opportunity, says a new report by Boston-based research and advisory firm Celent. The report, “Overview of the Indian Wealth Management Market”, examines the structural and contextual changes that are driving the growth of new product and provider classes, as well as highlighting future trends in the industry. It predicts that, with the liberalisation of the Indian economy and subsequent growth and prosperity across sectors, the wealth management industry is poised to gain greater traction in an expanding market. In particular, it finds the client segmentation schema promises growth across all the six categories by 2012: • Ultra high net worth, in excess of $30 million, will have a total population of 10,500 households; • Super high net worth, between $10 and $30 million, will have a total population of 42,000 households; • High net worth, between $1 million and $10 million, will have a total population of 320,000; • Super affluent, between $125,000 and $1 million, will have a total population of 350,000 households; • Mass affluent, between $25,000 and $125,000, will have a total population of 1.8 million households; • Mass market, between $5,000 and $25,000, will have a total population of 39 million households. And this phenomenal market opportunity is resulting in interesting dynamics at the provider end, where there is consolidation by segment. “At the product end, Celent foresees the launch of diverse products catering to different client segments and sophistication levels," says Ravi Nawal, analyst in Celent's banking practice and author of the report. "There is increasing momentum towards structure in this previously chaotic domain. We should expect some very India specific innovations in the near future."