India's ultra-rich landscape is evolving, marked not only by shifts in spending and investing habits but also by a significant transformation in the demographic makeup of the country's Ultra High Net-worth Individuals (UHNIs) in the past few years.

Today, 20-30% of India's UHNIs are younger than 40—a stark change from a decade ago. This is largely fuelled by the booming tech and startup sectors, alongside robust growth in the pharma and chemicals industries, ushering in an all-new generation of the super wealthy.

“We are seeing more younger people making money through their startups today, either via ESOPs (Employee Stock Ownership Programmes) or by exiting their ventures (IPOs or M&As). And these individuals are typically more global in their mindset and slightly more aggressive than the traditional UHNIs,” says Vodhi Chakravartty, head of strategy at Kotak Private Banking.

A typical UHNI portfolio in the age bracket of 50-60-plus would have more exposure to equity, debt, and real estate, which are the traditional asset classes. “But in the 30-40 age group, you will see stuff like alternates, global assets, startup investments, NFTs, crypto, other currencies, and a much more diverse range of investments in their portfolios,” he tells The CapTable.

“Also, in terms of mindset, they are far more open to diversifying their currency risks (by investing in dollars). And now with the RBI permitting each person to spend up to $250,000 annually via the LRS (liberalised remittance scheme), most of the younger UHNIs utilise this limit,” Chakravartty adds.

Changing asset allocation

Alternative investments—spanning gold, silver, private equity, unlisted assets, structured debt, derivatives, REITs (real estate investment trust), InvITs (infrastructure investment trusts), cryptos, and NFTs—which barely existed even two decades ago—are increasingly finding their way into UHNI portfolios.