Indian households savings and growth potential in equities

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1

Jefferies recently shared an interesting strategy report on Indian household savings. Sharing some highlights and charts from the same:

How much are Indian households saving?

Indian household savings has seen a steady rise in recent years. In the financial year 2022-23, the household’s savings stood at ~$800 billion.

Where does India invest the most?

  • Majority of the Indian household assets ownership include investment in properties, with share of over 50%, with Gold in second spot at 15.5%. Coming to equities, the % share of equities in Indian household assets has more than doubled from March 2013 to March 2023. However, it remains at just 4.7%.

Estimated annual structural domestic equity flows

  • As per the report, about 60% of the flows in mutual funds are contributed by retail. While 40% are contributed by insurance companies and EPFO and NPS.

SIPs as % of bank FD inflows

  • For every Rs. 10 additional invested into bank FDs, Rs. 1 comes into the market in the form of SIPs

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can you present the data excluding real estate. reason being not every city in the country has similar asset prices, valuation or appreciation.

Rest all the asset classes are uniform everywhere else

  1. gold
  2. bank deposit
  3. equity
  4. insurance and pension

it will be an interesting discussion thread.

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I doubt if we could find anything concrete and accurate about real estate ever :slight_smile: But, no harm in trying.

The amount of black money involved in that sector is mind-boggling. There’s a reason why no Govt can even touch that sector and do major reforms.

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real estate is not accessible for entry level investors.

the best way to invest is to buy a home or land using bank loan, and the emi can be considered as SIP
issue is that interest rates compound and will become > original capital if a longer tenure is taken

land has intrinsic value and mostly doesnt depreciate unlike some equity

so its a pros vs cons for the investor

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Why is every growth data always presented to us in Nominal numbers? If we adjust it to real inflation, there seems to be no real growth. Also, if you just look at the above data, there definitely has been some adjustment between 2017 to 2018 to how we calculate HH savings.
It’s like every article online wants to portray a fake rosy picture of growth and prosperity.

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Hi, can you please share the link of that report. Thanks!

7

Hi, can you please share the link to the report? @Meher_Smaran