At the level of the global economy, the historical link between the growth of wealth, or net worth, and the value of economic flows such as GDP no longer holds. These were the findings of a McKinsey report that borrowed a fundamental tool from the corporate world — the balance sheet — to take stock of the underlying health and resilience of the global economy.
Sanchit Gogia, the chief analyst, founder and CEO of Greyhound Research, says money in the country is entering an array of assets and only select real estate sectors. “Indians are investing in so many things. Real estate is selling but in pockets. For instance, Hyderabad (SEZ, commercial), or let’s say Gurugram (commercial) in certain sectors. But a lot of money is going in mutual funds, retail investing (and these are new-age investors), angel investors. All the IPOs for some of the larger companies like Paytm, etc. — most of their investors are retail investors.”
“People are flushed with savings as they stayed at home over the lockdowns. People are investing in gold, where the prices are at an all-time high. In cars, where there is a demand-supply constraint; in digital start-ups. I’m not sure it’s real estate-centric. I think it is more IPO-centric,” Gogia explains.
He says the new age money is coming from the new breed of tech investors. “They are liquidating their equity. The startup guys in Bangalore have almost nothing to do with real estate. The other lot is the more traditional investors who don’t understand tech or start-ups. They will invest in businesses that are asset-backed or physical assets like real estate. They also happen to have more money and so the larger chunk will always flow into the more traditional asset-backed businesses.”
Pointing to a virtuous circle he talks about an observation, “a lot of the retail money is coming to the market because of tech and tech-backed businesses.”Fortune
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