Wealthy Indian investors shift from stocks to real estate and infrastructure funds

what happened

According to Moody's, affluent investors in India are increasingly putting money into higher-yielding assets such as commercial property, logistics and infrastructure. The shift follows two years of weak performance on the country's main stock market.

At least six new vehicles launched this year aim to raise more than $1.25 billion for such projects. Nuvama Wealth Management, which oversees $39 billion in client assets, has raised around $420 million for a commercial property fund together with Cushman & Wakefield. Its chief executive, Ashish Kehair, describes a move toward private credit and assets that generate cash flow. The Nifty 50 index returned just 7% in total over two years, while the S&P 500 returned 29%.

why it matters

For markets, this signals that some wealthy family money is moving from equities into alternatives that promise steadier income. Demand for REITs and InvITs could grow, but returns on these funds depend on the assets, leverage and exit terms. By comparison, AAA-rated corporate bonds with three- to five-year maturities yield under 8% a year.

market impact

Indian REITs and InvITs: inflows from wealthy investors support demand for property assets

tags

instruments