There’s good news for several categories of products and services where the Ultra High Net Worth Households (UHNHs) are concerned. According to Kotak Wealth Management’s Top of the Pyramid 2014 report, the number of such households has increased by 16 per cent to 1,17,000 in FY 2013-2014 from 1,00,900 in FY 2012-2013. This is attributed to optimism about changes in the political and economic environment.
The changes have seen these super-rich consumers spend more on exotic food, luxury travel (even space travel), philanthropy and investments, with avenues like private equity being explored widely.
A UHNH is defined as one that has a minimum net worth of ₹250 million, mapped over 10 years.
This number will likely triple over the next few years, it adds. As a result, the net worth of UHNHs is projected to jump at an annual compounded rate of 34 per cent from an estimated ₹104 lakh crore in FY 2013-14 to ₹408 lakh crore by FY 2018-19.
Interestingly, close to 45 per cent of current UHNIs are seen residing in non-metro cities and smaller towns, says the report. Expenses have gone up from 30 per cent in 2012 to 44 per cent in 2013.
‘Top of the Pyramid 2014’ is based on in-depth interviews with luxury service providers such as luxury travel companies, luxury watch companies, jewellery companies, Wealth management relationship managers, and an extensive market research with 150 UHNIs across multiple cities.