Page 115 - Nuvama | IC Report 2023

INDIA: THE 5D ADVANTAGE
INDIA: THE 5D AD V ANT A GE

➦ Higher share of millennials and GenZ in population is not only
influencing spending attitudes and preferences, but also
morphing savings patterns

➦ Historically, household savings in India gravitated towards
physical assets such as real estate, gold and debt
instruments— bank deposits, national savings schemes, etc

➦ This is changing rapidly with the equity savings cult taking root,
even in tier-2 and tier-3 cities; in fact, equity AUM has soared
10x over the last eight years

➦ Strikingly, India’s per capita GDP, demography and household
debt profile resonate with the US of 1970s, which saw equity
cult among savers exploding. During 1980–2000, equity MFs’
AUMs in the US expanded at a whopping 20% CAGR versus just
5% during 1960–80; in India, a similar trend has just begun

➦ As the savings equity cult expands and capital markets deepen,
price discovery would become more efficient and deepen the
access to risk capital to businesses and entrepreneurs; its
importance for an economy in a rapid investment phase cannot
be emphasised enough

113
113