Rihanna was given 50 crore rupees for the performance. . .
the entire Bollywood was invited, Bill Gates and Mark Zuckerberg were also present and reportedly 800 crore rupees were spent for a pre-wedding function. Now these were Ambani's, but look at this. These are Privana South Luxury Apartments in Gurugram's sectors 76 and 77.
This project was made by DLF and it has 4 towers and 1133 houses. All these houses were sold in 3 days. What was the average cost of a house?
-- 7 crore. In 3 days, DLF earned 7200 crore rupees. These houses are cheaper compared to other luxury residential projects.
Like DLF's Camellias project in Gurugram where the cost of a house is around 100 crore rupees. A movie theatre, a club, a gym with a boxing ring and an indoor heated pool. .
. these are just some amenities present in DLF's Camellias. Welcome to the lives of crazy rich Indians.
The demand for luxury housing is so high in India that the developers don't have many projects. Prashant Thakur, a real estate consultant, mentioned that he hasn't witnessed such frenzy in the past decade. Due to these luxury apartments, DLF's share prices have increased.
This luxury economy isn't just about apartments. It's about watches and cars as well. Last year, Mercedes recorded the highest sales ever.
HSBC introduced the Black Metal credit card, featuring Virat Kohli as its brand ambassador to promote its private banking service to the ultra-rich. There are now several exclusive members-only clubs opening up in cities like Delhi for these individuals. Like The Chambers in the Taj Palace Hotel in Delhi.
Its joining fee is 25 lakhs and the annual fee is 3 lakhs. So how is this luxury economy booming in our country? How will it affect our country?
Everybody has materialistic expectations. Everybody wants to buy new products. That's why it's crucial to control your finances.
Whether we're an entrepreneur, a salaried employee or a freelancer. In college, we're taught how to get a good salary. But we're not taught how to grow our money.
Now, many middle-class Indians are getting richer. So it's important to fill the knowledge gap for which many fintechs are emerging in our economy. One of the emerging fintech companies is the 1% Club, founded by Sharan Hegde and invested in by Nikhil Kamath.
The goal of this club is to help people achieve financial independence, so they don't have to work solely for money. To grow our wealth, we need to know how to manage money which is often not optimized by salary or FD. Managing your own money is a scary thing for many people.
Here's where the 1% Club will be of help. With 1% Club, you'll get access to Financial Freedom University. You'll receive over 25 financial planning tools and have the opportunity to attend networking and in-person events, where you can not only find job opportunities but also learn from others about how they manage their wealth.
To experience this, you can sign up for a 2-hour personal finance masterclass conducted by Finance with Sharan. In this masterclass, you'll learn about Mutual Fund Investing, Early Retirement Planning and how to save money in taxes through 5 secret tools. So if you want to grow your money, join this masterclass.
You'll also get a 50% discount. The link is in the description First, let's understand who these wealthy Indians are. There are two ways to do this.
The first method is to examine the absolute number. For example, how many billionaires are there in our country? Last year, more than 2 lakh people earned over 1 crore rupees.
I'm talking about income, not wealth. The distinction between income and wealth is important. Income refers to the money you earn, such as your salary, while wealth takes into account your assets, such as property, gold, and investments.
But wealth data is not that good, so we'll talk about income. Many of you may find 2 lakhs to be a small number. You might argue that many millionaires don't even file their income tax returns.
So, even if you believe this, how many millionaires are there? 400,000, 800,000, or 1 million? A senior income tax officer mentioned that it's becoming harder to conceal your money due to improved bank reporting.
So the number of 2 lakh millionaires is not that bad. The second way is that of relative basis. That is, look at who comes in the top 10% and top 1% of India.
Our Prime Minister has an Economic Advisory Council, which offers advice to the PM regarding decision-making. This council has prepared a report. Can you guess what your monthly income needs to be for you to be in the top 10% of India?
I'll give you 3 seconds. 25,000 If your monthly income is 25,000, congratulations, you're in the top 10% of India. Does this number seem small?
Let's look at another report Based on the World Inequality Report, if your monthly income is 1 lakh rupees, you are among the top 10% earners in India. In India, most businesses are targeting this top 10% population. This is called Power Law.
Power Law refers to a scenario where a handful of people are accountable for a significant impact. Kunal Shah, the CEO of CRED, also said that E-commerce in India is mostly done through PIN codes like Hyderabad's Jubilee Hills, Mumbai's Bandra West, or Bengaluru's Koramangala. Bloom Ventures, a venture capital company, stated that despite there being approximately 30 crore families in India, only 10% of them, which is 3 crore families, have purchasing power In our country, only 3 crore families have Wi-Fi connections, cars, credit cards, and mutual fund investments.
There are 6 crore DMAT users, but only 3 crore people have more than 10,000 in their account. So if you want to start a business, target this top 10%. Take Zomato's example.
Zomato's 5% customers are responsible for 45% of their orders But do you think the top 10% of the population is investing in luxury apartments in Gurugram? No, it's the top 1% This is the top 1% of the population that travels abroad and buys iPhones. For example, last year, 90 lakh iPhones were sold in our country, which is less than 1% of our population.
The B2C brands that you see on Shark Tank can only survive if they appeal to the top 1% of the population. And the new brands that are launching, whether it's sneakers, luxury suitcases, or wedding video companies, are targeting this segment. Because of this top 1%, the sales of luxury brands like Hermes, Louis Vuitton, and Christian Dior have doubled in 4 years.
This is the truth about our country. Despite having a huge population, the people who have spending power make up the population equivalent to a European country. As Vir Das mentioned in his comedy show, there are two Indias.
But according to Bloom Ventures, there are not two, but three Indias. Now, their definitions are different. For this video, I have put the top 1% into India 1 and the top 10% in India 2.
And India 3 doesn't fall into either category If you want to run a good business, target the top 10%. If you want to run a premium business, target the top 1%. And where do these top 1% Indians live?
Mainly in 8 big cities of India -- Delhi NCR, Mumbai, Pune, Chennai, Hyderabad, Kolkata, Ahmedabad, and Bengaluru. But don't think that the top 1% live only in these cities. Last year, 60% of iPhones were sold in tier 2 and tier 3 cities.
Not only Apple but luxury watchmakers such a Rolex has opened a store in Raipur. Bulgari, a luxury retailer, held an exhibition for its products in Lucknow. Similarly, Lotus de Vivre, a luxury brand from Thailand, held an exhibition in Ludhiana.
Many private wealth management companies are also eyeing these cities for expansion. Private wealth managers manage the money of the rich. In return, they get a fee.
Such companies don't target the top 1%. But they target a small layer of the top 1%. These are called UHNWIs -- Ultra High Net Worth Individuals.
Their net worth is $30 million, or 250 crore rupees And there are 13,000 such individuals in our country. However, numerous wealth management firms are seeking out such individuals in cities of tier 2 and tier 3. There is a high demand for such services in cities like Morbi, Vapi, Panipat, Ludhiana, Tirupur, Raipur, Dehradun, Jamshedpur, and Rajkot.
There are many companies in this industry such as Motilal Oswal Private Wealth, 361 Wealth & Asset Management, and YTO Capital AMC. There's a high demand for this service and that's why these companies are competing against each other. A side note, if you're interested in finance, a job as a private wealth manager can be a good option.
Motilal Oswal Private Wealth said that the demand for wealth managers is increasing in India. So this is a career you can consider Let's shift our focus back to the video. Let's talk about the 361 Wealth & Asset Management company.
According to them, they now cater exclusively to customers with a net worth exceeding 50 crore. But soon they will launch a segment where they can serve people from 5 to 50 crore. Why?
Because the demand for it is increasing. In the last three years, almost 60,000 Indians have joined the millionaire club. But how did these people become millionaires?
People earn money in two ways in this world. One is with their time. That means, they invest their time in something and get paid for it, which is commonly known as salary.
But there is a problem in earning money with time. Because everyone has only 24 hours of time. It's the same for you and me.
That's why Naval Ravikant said in his viral Twitter thread that wealth is not earned through time, but through assets. Because the value of assets can increase when you are sleeping. That's why super-rich people are not rich because of their time.
They are rich because the value of their assets is going up. And this is the same for India. You must have heard of old money and new money.
Old money people have been rich for many years. They can be actors, businesspersons or politicians. I'm not talking about them in this video.
I'm talking about new money people. Who are they? Byju Ravindran, his wife Divya Gokalnathan and his brother Riju Ravindran.
Since 2015, these three people earned $400 million, that is, more than Rs 3,000 crore. Many startup founders have entered the new money category due to the startup boom in India. Many startup founders don't have a high salary.
Piyush Bansal's annual salary is Rs 3. 7 crore. Gazal Alak's salary is less than Rs 1 crore.
Founders earn money by selling their company's shares. This is Mithun Sancheti who sold his online jewellery company Caratlane's 27% share to Tata for more than Rs 4,000 crore. With these 27% shares, Mithun has sold his entire company to Tata.
But a founder doesn't need to sell his entire company. He can sell some of the company's shares through secondary sales. These secondary sales were used by Byju and his family to earn money.
Primary sales are when the company earns money by selling its shares. In secondary sales, the company doesn't earn money but the founder does. Many investors are not fond of these secondary sales because they result in a decrease in the founder's ownership and do not generate any revenue for the company.
If the founder doesn't have ownership then why would he work hard? He sold his shares and earned money. Ashneer Grover said on Twitter that founders should do secondary sales.
However, some investors think that this indicates that the founder is not committed to developing the company. Some secondary sales are not an issue as it provides relief to the founder. He can pay his debts, buy a house and earn a good income for 2-3 years.
But if he sells more shares, would he work hard to develop the company? Many founders are making money by selling these secondary shares and buying a house. Now, startup founders aren't the only ones in the category of new money.
There are many professionals like corporate executives or lawyers. The speed of wealth creation in the startup world is greater than that of the corporate world. Many employees benefit from secondary sales in the startup world through ESOPs.
A good example of this is Flipkart. The payout from Flipkart's ESOPs was so high that the demand for 3. 5-5 crores worth 4BHKs and villas in the Belandur area went up to.
Flipkart office is also located there. ESOPs means Employee Stock Ownership Plan which gives employees ownership of the company. It's a good way to develop loyalty.
If the company does well, its valuation will increase. If the valuation increases, ESOPs value will increase and the employee will benefit. Usually, people who work longer get greater ESOP payout.
Flipkart's ESOP payout took place because of Phone Pe. But we won't go into details. Actually, a lot of Flipkart employees have been categorized as India-1 because of this payout.
Many Flipkart employees were looking for a house not because they wanted to live there. But it was their second house. Why?
To save tax. This part might be a bit complicated, but it's crucial for you to grasp the link between India's high-end real estate market and startups. Let's say you're a business owner and you sold your business.
If you held your business shares for more than 2 years, you would be liable to pay long-term capital gains tax. If the business value was more than 5 crores, the tax would be 24%. If you sold a share worth 100 crores, you'd have to pay a tax of 24 crores.
To save this tax, people use the Section 54F of the Income Tax Act. You can save tax by using this act by investing whatever you earned from selling your business in a residential property. If you sell your business for 100 crores, you would have to invest in a residential property worth 100 crores to avoid paying a long-term capital gain tax.
Zero tax. But there's a problem here. A business owner can only buy one property.
This is why many business owners include their nephews and siblings in the cap table i. e. they become the investors.
This way, when a business is sold, everyone can buy their property. If a 100 crore business is owned by one person, they'll have to buy property worth 100 crores. But if you make 4 family members co-owners, each of them can buy a property worth 25 crore.
There's a caveat: you can't sell a residential property for 3 years. Next time you see a business owner buying a residential property, know that he's saving a long-term capital gain tax. Our government also found out what business owners are doing.
So they made a tax exemption limit of 10 crores. If you sell your business for 100 crores and buy a residential property worth 100 crores, you won't have to pay tax for 10 crore, but you'll incur 24% tax on 90 crore. This is why Bengaluru's luxury residential property market is booming.
There's also a behavioural change. After COVID, many people want big houses. That's why they're upgrading their apartments.
A financial professional from Pune, Vishal Gupta, said that he used to live in a 2BHK house. But now he's bought a 4BHK house worth 2 crores so that he can get more space. Usually people buy fewer houses when interest rates are high.
Because when rates are high, you'll have to pay more interest on home loans. But interest rates have been high for the past 2 years. Still, there's a boom in the housing market.
This is due to a FOMO that's why many people are buying houses. A person from Mumbai said that they were planning to wait for 2 years for the interest rates to decrease before making a decision. But he feared that if property prices go up, he'd be left with nothing.
That's why he bought a 3 crore worth house 2 years ago. There's so much demand for houses in Indian cities that prices are going up. The prices of houses in India's top 8 cities have gone up by 13% in the last 5 years.
So the condition of India's property market is that the EMI and property prices are soaring. Still, the market is booming. A few days ago, a new luxury residential project was launched in Mumbai's Versova, which sold 4,5BHKs for only 20 crores!
But in India's luxury property market, NRIs also play a big role. In the introduction, I talked about DLF Privana South Luxury Apartments. 25% of those apartments were sold to NRIs.
Many NRIs were from Kenya and Tanzania. For these NRIs, purchasing such apartments is seen as an investment opportunity to reap the benefits of India's growth story. NRIs invest in property because investing directly in the stock market is not as easy for them due to regulations.
And it's the stock market where most Indians have earned their money in the past 5 years. Historically, most Indians considered the stock market to be risky. Only a few people were willing to play this game.
Like Rakesh Jhunjhunwala. Prior to this, the Indian stock market was dominated by institutional investors. These could be big investment banks such as JP Morgan or asset managers.
Retail investors like you and me weren't interested in the stock market. This changed during COVID-19. Stock markets grew and many finfluencers emerged.
Many retail investors joined the stock market learning from Reddit, YouTube, or courses. Many companies started big businesses targeting these retail investors. Between 2019 and 2023, 12 crore investors registered.
Retail investors are now joining the stock market from states where it was not even a topic of discussion before. The number of registered investors in the Bombay Stock Exchange increased by 27% in 2023, and this growth rate was 40% for UP and Bihar. This has benefited the rich Indians the most.
72% of affluent Indians said that the stock market was a major reason for their wealth. Those who didn't benefit from the stock market benefited from gold. In January 2020, 10 grams of gold cost Rs.
39000. In December 2023, it was around Rs. 62000.
That's an increase of 65%. For Indian households, buying gold is a tradition. In fact, 11% of the world's gold is owned by Indian households.
This is because gold is a safe asset. Inflation or exchange rate fluctuation doesn't affect the price of gold. Whether it's the Russian-Ukraine war, COVID, or economic slowdown, the prices of gold don't fluctuate much.
This is why whenever there's a crisis, many investors buy gold. That's why gold prices have been going up for the past 4-5 years. Actually, an investor once said that when gold prices go up, Indian consumers are very happy and tend to splurge on shopping, even if they haven't sold any gold.
However, having money doesn't necessarily mean they will spend it all. Some people are very stingy. But now in India, the attitude of the rich has also changed.
In the olden days, people used to hide their money. But now they want to show it. This gets cleared with Instagram Reels.
This is happening with the rise of Nouveau Riche. Nouveau Riche is a French word for people who have recently become rich and want to show off their money. In its report, Goldman Sachs said, we see more people like this in our country.
These people are earning money not just to save, but also to spend. And that's why more SUVs are being sold in our country. In 2022, 42% of the cars sold in our country were SUVs.
And a year later, this number has increased to 48%. Now India 1 and India 2 are not the only ones spending. India 3 is also spending.
Even Uber drivers roam around with good phones. The latest government data reveals that people in both rural and urban areas are spending more money. But if you look at the sales of mass products, the picture is very different.
Mercedes is having record sales, but the sales of tractors are declining. According to Nestle, their high-end products are performing well, but their mass-market products are not selling. If India 1 and India 2 are thriving, the same's not the case with India 3.
The world of India 1, 2, and 3 is very different. And to keep it separate, they build walls between themselves. But the problem in India is that these walls are very thin.
That's why even Mukesh Ambani's car goes on the same road where slums are located. These three Indias never face off against each other because India 1 holds most of the money. There are only two places where there is equality between these three.
One is elections, and the other is social media. So what is entertaining for India 3, is cringy for India 1. "If you want to get a girl to leave a guy, show her this.
" "For a second, the guy in the back seemed like Kamal Khan. " But as soon as you leave social media and elections, this equality goes away.
