Exploring Alternatives to SME IPOs: A Wealth Growth Strategy
Investors seeking to grow their wealth may find more reliable options beyond SME IPOs, including mutual funds, stocks, ETFs, real estate, and REITs.
Mutual FundsEtfsReitsReal EstateStartup InvestmentsReal Estate NewsSep 19, 2024
Each investment avenue provides unique advantages, from professional management and diversification in mutual funds to the direct ownership of stocks and the income potential of REITs. Understanding these options can empower investors to make informed decisions that align with their financial goals and risk tolerance.
Mutual funds, for instance, offer a safer and more accessible way to build wealth than SME IPOs. According to Jitendra Sikligar from MySIPonline, the Indian mutual fund industry has seen impressive growth, with assets under management reaching ₹46.37 trillion in March 2023, a 21% increase from the previous year. Equity mutual funds, particularly large-cap and multi-cap funds, have consistently delivered 12-15% returns annually over the past decade.
Passive funds and ETFs provide a low-cost investment option by tracking significant indices like the Nifty 50 or Sensex. With assets under management surpassing ₹7 trillion in 2023, these funds are popular among cost-conscious investors. Regular portfolio rebalancing is necessary to adapt to market changes.
Real Estate Investment Trusts (REITs) offer a promising investment alternative. Since their introduction in 2019, Indian REITs have shown solid growth, with the Embassy Office Parks REIT returning over 20% since its listing. One of their main attractions is the requirement to distribute 90% of net cash flow to unitholders, ensuring a steady income stream.
The Indian real estate sector, valued at $200 billion in 2021, is projected to reach $1 trillion by 2030. Residential sales have surged post-pandemic, with top cities seeing a 71% year-on-year increase in 2021. Cities like Hyderabad and Bengaluru are experiencing significant price growth, particularly in premium areas. The commercial real estate market also offers attractive rental yields, especially in IT hubs, driven by strong demand.
Angel investing in India's booming startup ecosystem is another exciting opportunity. With 23 new unicorns in 2022, platforms like LetsVenture allow investors to enter high-growth sectors like fintech and health tech with as little as ₹5 lakh.These alternatives to SME IPOs provide a range of options for investors looking to grow their wealth in diverse and potentially lucrative markets.
Frequently Asked Questions
What are the benefits of investing in mutual funds?
Mutual funds offer professional management, diversification, and a safer way to build wealth compared to SME IPOs.
What is the growth potential of REITs in India?
Indian REITs have shown solid growth since their introduction in 2019, with the Embassy Office Parks REIT returning over 20% since its listing.
What is the projected growth of the Indian real estate sector?
The Indian real estate sector is projected to reach $1 trillion by 2030, from $200 billion in 2021.
What are the risks associated with angel investing in startups?
Angel investing in startups comes with increased risk, making it suitable for those who can navigate the startup landscape.
What is the minimum investment required for angel investing in startups?
Platforms like LetsVenture allow investors to enter high-growth sectors like fintech and health tech with as little as ₹5 lakh.
Related News Articles
Indian Real Estate Market Poised for Growth, Says Industry Expert
The House of Abhinandan Lodha targets Rs 2,400 crore revenue in FY25, Macrotech acquires 3 land parcels in Mumbai and Pune, and more
India's Housing Market Sees 5% Growth in Q3 2024, Mumbai Leads the Pack
The housing market in India has witnessed a 5% growth in Q3 2024, with Mumbai emerging as the top performer. The city saw a 9% growth in sales, with 24,222 units sold during the quarter.
Bharat Dhir: From the USA to Mumbai for a Standup Comedy Dream
Meet Bharat Dhir, a stand-up comedian who made a big move from the USA to Mumbai. Discover why he believes the Indian comedy scene offers more opportunities and learn about his unique journey.
Flat and Villa Enthusiasts Flocking to Thiruvananthapuram: A Property Boom in the Capital City
Thiruvananthapuram has emerged as the top destination for residential property registrations, surpassing Ernakulam. The real estate market in the capital city is witnessing a significant boom, attracting both investors and homebuyers.
MSRTC Revitalizes 3,360-Acre Land Bank with 160 New Tenders
The Maharashtra State Road Transport Corporation (MSRTC) is set to develop a massive 3,360-acre land bank with 160 new tenders, encouraging real estate developers to explore new opportunities.
Uttar Pradesh: Blending Heritage with Economic Growth – CM Yogi Adityanath's Vision
Uttar Pradesh CM Yogi Adityanath, speaking at the India Today Conclave 2025, elaborated on the state's strategy to leverage its rich cultural heritage and religious tourism to drive economic progress.