Bengaluru: Assets managed by India’s mid-sized and large family offices could rise by about 50% to around Rs 1.05 lakh crore over the next three years, from an estimated Rs 70,000 crore in 2024, as wealthy business families increase allocations to startups, private equity and private credit.The projection was cited in a report released by Julius Baer and EY. Family offices are private structures that manage the investments, tax affairs, succession planning and philanthropic activities of wealthy families.The number of such offices in India is estimated to have risen from around 45 in 2018 to nearly 300 in 2024-25. Most are single-family offices. However, comprehensive data remains unavailable as India does not have a separate regulatory framework governing them.The growth has been driven by promoters monetising wealth through IPOs, private equity exits and business sales. Rather than reinvesting all the proceeds in their core businesses, families are increasingly building diversified investment portfolios.Traditionally, these portfolios were concentrated in listed equities, fixed deposits, bonds, real estate and gold. The newer generation of family wealth is, however, allocating more capital to private equity, venture capital, private credit, and funds investing in real estate and infrastructure.At the more aggressive end, alternative investments now account for 40-45% of some family office portfolios, the report said. The shift, however, remains uneven. Only about 12% of Indian family offices allocated 20-30% of their portfolios to alternatives in 2024. That proportion could rise to around 25% in the coming years.Family offices are also increasingly investing directly in companies or negotiating co-investment rights. Such arrangements allow them to invest alongside private equity or venture capital funds in specific companies, giving them greater control while potentially lowering the fees paid to fund managers.Artificial intelligence, climate technology, renewable energy, semiconductors, electronics manufacturing, cloud services and data centres are among the sectors attracting this capital.“Indian family offices are evolving from wealth preservation vehicles into active allocators of long-term capital,” said Surabhi Marwah, tax partner and leader of family office advisory services at EY India. “This shift is also bringing greater focus on governance, succession planning and professional management.”India has more than 19,000 people with assets exceeding $30 million, a number projected to cross 25,000 by 2031. An estimated $1.3 trillion to $1.5 trillion of wealth is also expected to pass between generations over the next decade.The changing profile of family offices is prompting families to hire professional investment heads, finance executives and risk specialists. Expansion into overseas and illiquid assets is also increasing the need for stronger systems around succession, taxation, cybersecurity and regulatory compliance, the report said.
