Where the rich are investing 2016

Aditya Bagri

Bagrrys India's director follows a disciplined approach to both business and personal wealth management

Vishal Koul

Aditya Bagri’s breakfast cereal brand may not be Kellogg’s but it does corner more than half the market share in a category (muesli) within the breakfast cereals' segment. Bagrry’s sits pretty with a Rs.100 crore turnover within a breakfast cereal market, which itself is just Rs.1,400 crore (as per Euromonitor) but is growing rapidly with consumers increasingly getting health conscious.

Just like in business, the Bagri family takes a disciplined approach to manage their personal wealth as well. “We are conservative investors and prefer to grow our wealth through good quality assets,” says the scion. Aditya’s father Shyam Bagri, who started the business in the early 90s, continues to take investment calls along with a team of in-house experts.

Historically, the family has preferred financial assets over real estate. “Over the years, more of our investments have happened in liquid assets than real estate. We have invested in realty more from a business perspective,” reveals Bagri.

In the past ten years, the family has invested in debt and fixed-income instruments, tax-free bonds and in equities through mutual funds and PMS. “Our portfolio is geared more towards AA or AAA-rated debt and fixed income because we want less volatility,” explains Bagri.

Of late, the family is looking at a new asset class — private equity. “Given the way the business landscape is changing, within equity, we are allocating a small tranche towards private equity,” informs Aditya. But the family knows PE is a long-term game. “The idea behind private equity is also to use it as an opportunity to understand the start-up ecosystem and evolving technologies in India,” says Bagri. The family is not investing directly, but is using the proxy approach. “It’s better to invest in PE funds, because managers do due diligence much better than you can yourself. Some of these funds have invested in fairly successful e-commerce start-ups,” says Bagri.

In a nutshell, the wealth formula for the Bagris is three-pronged — safety through bonds, better returns through listed equities and allied instruments and generating alpha through high-risk assets such as PE. In other words, just like their breakfast offering, Bagri believes their asset allocation, too, is as balanced and healthy as it can get.

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