Portfolio Management Services (PMS) and Alternative Investment Fund (AIF) structures are gaining massive traction that by 2031, the assets under PMS and AIF industry will cross Rs 50 lakh crore, PMS Bazaar said at its annual summit 'PMS&AIF 4.0: Alternative Assets for All Seasons'.
PMS Bazaar is a PMS advisory startup that recently partnered with Paytm Money.
Alternatives will emerge as a powerful tool of wealth creation on the back of 20% CAGR growth in the next 10 years, said experts.
Aashish P Somaiyaa, CEO, WhiteOak Capital Management said, "With rising affluence and the preference for a wider variety of risk-return combinations that can be generated across asset classes; PMS and AIFs are becoming the mainstay of any wealth management proposition."
At the summit, experts pointed out that assets under the management of discretionary and non-discretionary PMS (non-EPFO) stood at Rs 3.97 lakh crore at the end of October 2021. This is expected to grow six-fold and surpass Rs 24 lakh crore by 2031 boosted by robust returns, transparency, and unique investment strategies.
The size of the AIF industry, across all categories, stood at Rs 4.87 lakh crore according to the latest data. This is expected to grow over six-fold and reach Rs 30 lakh crore in the next 10 years. PMS and AIF products are emerging as strong alternatives to grow wealth and investments.
Vikas M Sachdeva, CEO, EMKAY Investment Managers said, "Recent years have seen the global alternative industry grow at a rapid pace. This is largely driven by a need to enhance returns and increase diversification. This growth is also supported by external conditions such as lower interest rates, availability of information, the maturation of emerging markets, and a structural change in capital formation."
Given the current state of the industry, and the recent developments in regulations, it is expected that India's alternative investment industry will follow the global trend and take a greater share of India's investable universe. The minimum investment in PMS is Rs 50 lakh.
AIFs, which have a minimum ticket size of Rs 1 crore, offer investors access to sophisticated strategies across different asset classes and more diversification in a risk-adjusted manner.