Indian family office assets are expected to grow 1.5 times over the next three years, driven by rising wealth creation, promoter exits and a shift towards institutionalised investing. According to a joint report by Julius Baer India and EY India, family office assets will rise from ₹70,000 crore in 2024, supported by an expanding ultra-high-net-worth (UHNI) population and greater participation from the next generation of business families. Surabhi Marwah, Tax Partner and Leader, Family Office Advisory Services at EY India, said the projected growth is being driven by multiple factors, with fresh capital creation playing the biggest role. She pointed to initial public offering (IPO) exits, offer-for-sale (OFS) transactions and promoter stake sales that are creating investable wealth for both first- and second-generation entrepreneurs.
India's family offices are increasingly diversifying their portfolios beyond traditional assets like equities, bonds and real estate. According to The Economic Times, these sophisticated investors are seeking differentiated sources of alpha through private credit, venture debt, co-investments and alternative investment strategies. The shift represents a move away from closely correlated public market cycles toward specialized strategies that offer access to unique return drivers and risk profiles. Ashwin Patni, Head of Wealth Management Solutions at Julius Baer India, said family offices continue to keep listed equities at the centre of their portfolios, but are steadily increasing exposure to alternative investments. "People are very comfortable, especially with their long-term money, to take a meaningful risk, a calculated risk," he said.
India's alternative investment market is projected to exceed $2 trillion by 2034, driven by high-net-worth investor participation and demand for higher-yielding, less-correlated assets. According to the latest Julius Baer-EY report, the market currently stands at approximately $400 billion, including $156 billion in SEBI-registered Alternative Investment Funds (AIFs). The remainder comes from offshore vehicles, family offices and unlisted structures. Family offices are expected to increase allocations to artificial intelligence (AI), private markets, Real Estate Investment Trusts (REITs), Infrastructure Investment Trusts (InvITs) and other alternative assets, with around 40-45% of allocations now moving towards alternative assets. The report estimates that India's ultra-high-net-worth individual (UHNI) population is expected to rise from around 19,000 to nearly 25,000 over the next few years, creating more capital for long-term investments.
AI is influencing family offices in two significant ways - as a preferred investment theme and as a tool for improving governance and investment processes. According to EY India, AI-powered tools are helping family offices evaluate investment opportunities, monitor portfolio performance, strengthen cyber risk management and generate real-time management information as investment portfolios become larger and more complex. Ashwin Patni noted that AI, climate technology and renewable energy have emerged as important investment themes, although many of these sectors are still in the early stages of their investment cycle. "Returns are probably in the future," he said, adding that family offices are increasingly choosing to become active participants in these sectors rather than remaining passive investors. Their investment focus is expanding towards artificial intelligence, climate technology, renewable energy, digital infrastructure, energy storage, semiconductors, electronics manufacturing, cloud services and data centres.
Patni also highlighted global diversification as an area where Indian family offices can improve. He said many investors continue to evaluate opportunities only through a domestic lens, despite increasing integration of global markets. According to him, family offices should benchmark Indian sectors and valuations against international peers while also considering global risks when constructing portfolios. The report expects family offices to play a larger role in long-term capital formation as their investment strategies become more institutionalised. It said stronger governance, technology, professional talent and data-led decision-making will be increasingly important as these investors expand across alternative funds, private equity, venture capital and pre-IPO opportunities. The number of family offices has increased dramatically from around 45 in 2018 to nearly 300 by 2024-25, reflecting the growing institutionalisation of wealth management in India.
