The asset class at the centre of this was Private Credit, a market that barely existed 20 years ago and is now worth more than $2 trillion. And here is how it got there.

After the 2008 financial crisis, banks became much stricter about lending. Mid-sized companies still needed capital, so private credit funds stepped in. They raised money from large institutional investors, pension funds, insurance companies, endowments, who were willing to lock their capital away for several years in exchange for returns of 8 to 12% annually, well above what bonds or deposits could offer at the time.

For a long time, it worked well. But then two things changed.

First, interest rates rose sharply after 2022. Since most private credit loans have floating rates, borrowing costs went up quickly, putting pressure on companies that had taken those loans.

Second, many US private credit funds had large exposure to mid-sized software companies. AI disrupted parts of that sector faster than expected, making some business models look weaker overnight.

When both problems hit at once, investors rushed to withdraw their money. But many funds had promised quarterly withdrawals even though their loans were locked in for 4–5 years. So when too many investors pulled out at once, a bank run on the fund, the funds ran out of cash and froze withdrawals.

That mismatch triggered the freeze. But most coverage missed that private credit isn’t one market, it’s six different strategies with very different risks. The affected funds mainly lent to software startups, loss-making firms, and stressed businesses dependent on uncertain future outcomes.  

But there is one sub category of private credit that works very differently. It lends only to stable, operating businesses with real revenues, real assets, and a clear ability to repay. It’s called Performing Credit. That’s what this edition covers.

In this edition, we’ll cover:

• What Private Credit is and how the three-player system works
• Where it sits in the investment universe relative to every other asset class
• The six strategies within Private Credit, and where Performing Credit fits in
• How Performing Credit compares across the risk-return curve
• How fast is India’s Private Credit market growing, and what’s being funded
• Who is this for and how to access this asset class as an investor
• Top funds in India and key things to consider before investing 

How Private Credit actually works

Picture a mid-size Indian pharmaceutical company that needs ₹200 crore to acquire a competitor. The deal needs to close in eight weeks. Their bank says the process takes four months and the structure doesn’t fit standard lending templates. The public bond market requires a credit rating and a roadshow that would take just as long. Neither option works.

A private fund closes the deal in three weeks. The loan is negotiated directly between the borrower and the fund, terms, repayment schedule, security package, everything built around the company’s actual cash flows rather than a bank’s checklist. The borrower gets the capital and the fund earns 14 to 16% annually, secured against hard assets and promoter pledges.

The diagram below shows how the money actually moves.

Three parties make every deal work. 

1. The borrower is usually a mid-sized company with steady cash flows that needs money for an acquisition, expansion, refinancing, or other business needs that banks either can’t support or won’t move quickly enough on.
   
2. The fund pools capital from investors, underwrites the loan directly, negotiates the terms, and holds it to maturity.
   
3. The investor is whose capital is being deployed, historically this was institutions like pension funds, insurance companies, endowments. In India today, it increasingly includes HNIs and family offices, with a minimum ticket of ₹1 crore.

These investments happen through a SEBI-regulated structure called an Alternative Investment Fund, or AIF. SEBI created the AIF category to bring some order to investments that sit outside mutual funds and direct equity. They come in three types. Category I backs startups, infrastructure, and social ventures. Category III uses complex strategies involving leverage and derivatives. Category II is where private credit funds live. All these categories are closed-ended and accessible only to investors who meet SEBI’s criteria.

What are the different types of Private Credit and that difference matters

Private credit is a broad term that covers very different kinds of lending. Before understanding where Performing Credit fits, it helps to see the full picture of what private credit actually covers.

Direct lending, loans to mid-market companies with proven cash flows, dominates globally at 52% of AUM and is the foundation of India’s private credit market. 

Asset-based finance on the other hand lends against physical collateral rather than the company itself, offering lower yields but hard security. 

Then there are strategies like venture debt, which lends to early-stage startups with little or no cash flow, and distressed debt, which lends to companies already under financial stress. These can generate higher returns, but they also come with much higher risk and require a very different kind of expertise to manage well.

That is where Performing Credit stands apart, it focuses on lending to businesses that are still healthy, generating cash flows, and making regular repayments.

Many people may assume Performing Credit is just another name for Private Credit. But Performing Credit is a specific sub-category that lends exclusively to financially stable, operating businesses with real cashflows, hard collateral, and structured repayment. The borrower is a company that is doing well and needs capital to grow, not a startup burning cash, and not a distressed company hoping to turn around.

Most of the stress making headlines in the US right now is concentrated in venture debt and special situations, the higher-risk end of private credit. Performing credit sits at the other end of the spectrum entirely.

Where performing credit sits in the risk-return landscape

Performing credit doesn’t force you to choose between safety and returns. Instead, it sits in a unique space outside traditional public market investments, offering a balance of risk and reward.

When building a fixed income portfolio in India today, the trade-off is mainly between risk and return. Bank and corporate FDs typically offer around 7–8% with low risk. Debt mutual funds are in a similar range. A-to-AA rated bonds can generate 9–12% returns with moderate risk. At the higher end, venture debt and distressed credit strategies may offer 16–22% yields, but the risk involved is significantly higher.

Performing credit sits between those two poles, aiming to deliver roughly 14-16% gross yields at moderate risk levels, similar to A or AA-rated bonds, but with relatively higher returns.

That reason being that these funds negotiate directly with borrowers, moving faster than banks and with more flexibility than public bond markets. That speed and customisation commands a premium. And since these loans are usually held until maturity instead of being traded daily in the market, returns are less affected by short-term volatility.

Why India’s Private Credit market exists, and why it’s growing so fast

Many investors worry that the problems seen in global private credit markets could eventually spread to India. But India’s market has been built very differently.

In India, performing credit is mainly offered through SEBI-regulated Category II AIFs. These are closed-ended funds, which means investors cannot redeem or withdraw money midway. That structure helps avoid the liquidity problems that created stress in parts of the US private credit market. Regulations around leverage are also stricter, and better-quality funds usually have stronger collateral and tighter lending terms.

What’s worth understanding, though, is that locked-up does not mean frozen. Capital is drawn in tranches over roughly the first year, quarterly interest distributions begin flowing from Year 1, and principal starts returning as loans mature through Years 2 to 4. The 6-year fund life is the outer envelope, not the average experience so the effective duration on your capital is closer to 3 to 3.5 years, making this a medium-term commitment rather than the long lock-in.

But the bigger story is growth. 

India’s private credit market is still small relative to the economy. Private credit is around 0.6% of GDP in India, compared to about 3.8% in the US, showing how early the market still is. As banks tighten lending and companies look for faster, more flexible funding, private credit is becoming a bigger part of financing in India.

In 2025, India saw $12.4 billion in private credit deals, up 35% from 2024. The market has grown more than 10x from around $600 million annually in 2012. Real estate makes up about 42% of deal activity, while healthcare and industrial products account for roughly 15% each. 

Earlier, private credit in India was dominated by global firms like Blackstone, Ares Management, Farallon Capital, and Värde Partners. But that is changing. Domestic funds now make up 64% of deal value and 69% of deal volume, showing that Indian managers have built strong underwriting capabilities and local expertise.

A major reason India’s performing credit market could grow was the introduction of the Insolvency and Bankruptcy Code (IBC) in 2016. Before the IBC, recovery cases could drag on for years if a borrower defaulted. The IBC created a faster, time-bound recovery process and gave lenders stronger legal protection. Since then, creditors have recovered over $44 billion, and resolution rates have improved sharply.

More than anything else, the IBC gave lenders confidence. It made lending beyond just the safest companies feel like a viable business, not a game of chance.

Who should consider this asset class?

Performing Credit tends to work best for investors who already have their core portfolio in place, equities, debt, real estate, and are looking for a source of income that is less tied to daily market movements.

They understand that locking money in for 3 to 5 years is part of the trade-off for earning higher yields than bonds or fixed deposits. They are not chasing maximum returns. They want steady income, predictable cash flows, and exposure to India’s mid-market corporate credit space, an area most portfolios usually miss.

In terms of risk, performing credit sits somewhere in the middle. You are lending money, not buying equity. Your returns depend on whether the borrower can generate enough cash flow to repay the loan, not on stock prices rising. That is why the quality of the borrower, the collateral, and the fund manager’s discipline are so important.

But it is not suitable for everyone. If you may need your money back in 2–3 years, if your portfolio is still not diversified, or if you are only attracted by the high yield without understanding the lock-in and illiquidity, this is probably not the right fit.

Here are two ways to access it  

1. There are two routes into performing credit: Investing directly into individual credit deals alongside institutional lenders.The advantage is transparency, you know where your money is going, can negotiate terms directly, and avoid fund fees. But the downside is concentration risk. A direct portfolio may have only 8–12 loans, so even one bad loan can hurt returns. Evaluating these deals also requires deep financial, legal, and collateral analysis, which usually needs institutional expertise.

2. Performing credit fund, a SEBI-regulated Category II AIF where a professional manager handles the sourcing, underwriting, portfolio management, and ongoing monitoring. You get diversification across 15 to 25 deals, professional oversight, and a structured legal framework. The trade-off is fees, access quality, and the challenge of choosing the right fund, which is harder than it looks.

The table below shows India’s top 24 private credit lenders by deployment volume in H1 2025.

If you look at the large private credit funds like Farallon Capital, Ares Management, BlackRock, PIMCO, and Bain Capital, they mainly raise money from institutions, making access difficult for most individual investors.

Even in India, funds like Kotak, 360 ONE, Neo Asset Management, and InCred often offer better terms to larger investors. Smaller investors may face higher fees and less visibility into underlying deals. And while many funds look similar on paper, understanding borrower quality, collateral, and repayment history requires deep diligence.

So before committing to any fund, there are two sets of questions worth going through, one for yourself, one for the relationship manager/wealth manager.

At Dezerv, Performing Credit is typically considered for clients with portfolios above ₹5 crore. Below that, the allocation often becomes impractical.* 

In conclusion

India’s performing credit market is growing and the long-term opportunity is significant. But accessing it properly requires more work than simply investing in a mutual fund. You need strong deal sourcing, disciplined underwriting, good collateral structures, reasonable fees, and the patience to stay invested through a 3-4 year fund cycle.

The investors who do this well are usually the ones who treat performing credit as a thoughtful portfolio allocation, not just a way to chase higher yields. They understand where the returns come from, what risks they are taking, and what trade-offs they are making.

Disclaimer – Investment in the securities market is subject to market risks, read all the related documents carefully before investing. The information provided herein is intended solely for educational purposes and should not be construed as solicitation, advertising, or providing any financial or investment advice or an offer to buy or sell any financial instruments. The past performance of the financial strategies, instruments and portfolios is not indicative of future performance. Such past performance may or may not be sustained in future. Any statements about future developments are speculative and should not be taken as guarantees. Readers are advised to consult with their financial advisor before making investment decisions based on the information provided herein.

In the preparation of this document, Dezerv has used information developed in-house and publicly available information and other sources believed to be reliable. The information is not a complete disclosure of every material fact and terms and conditions. While reasonable care has been made to present reliable data in this article, Dezerv does not guarantee the accuracy or completeness of the data. The information / data herein alone is not sufficient and shouldn’t be used for the development or implementation of an investment strategy.

Any references to names of fund houses, investment securities, or asset classes are for illustrative purposes only. Dezerv, along with its directors, employees, or partners or any of its affiliates, shall not be held liable for any loss, damage, or liability arising from the use of this document. Additionally, all trademarks, logos, and brand names mentioned are the property of their respective owners and are used for identification purposes only. The use of these names, trademarks, and logos does not imply endorsement or recommendation.

The experiment was a disaster at first. Cards were stolen, fraud surged, and losses mounted. The programme nearly collapsed. But Bank of America kept going, expanded across the country, and BankAmericard eventually became what the world now knows as Visa. What began as a risky experiment in one California city became the backbone of global commerce.

The reason I am thinking about Fresno this week is a conversation in our office about people planning summer travel, comparing business class upgrades, checking lounge access, and figuring out whether their hotel points were still valid. It struck me how different this would have sounded a decade ago. Back then, credit cards in India were mostly about credit. Today, for a growing group of professionals, they are about spending strategically.

India now has 118 million credit cards in circulation and annual spending of ₹23.62 trillion, roughly ₹2 lakh per card each year on average. But the premium cards covered in this newsletter operate at a very different level. Cards like Infinia, Magnus Burgundy, and HSBC Premier often require ₹10–35 lakh in annual spending to truly justify their fees and benefits.

These users are a tiny fraction of India’s cardholders, but they account for a disproportionate share of spending. And yet, more than 50% of reward points in India still go unredeemed every year. This newsletter looks at a simple question: after years of changing reward structures and devaluations, how much value are people actually getting from all that spending?

In this edition:

• How India’s credit card market tripled in value, and what that growth quietly cost existing cardholders
• Who actually funds your rewards every time you swipe
• Why banks are cutting benefits even as they sign up millions of new customers
• The privileges premium cardholders still have access to, and the ones that have quietly disappeared
• A comparison of the six premium cards that matter most right now
• How to earn the rewards the right way
• Tools and people worth following if you want to go deeper

How India’s credit card market tripled in five years

India’s credit card market has gone through a fundamental transformation over the last five years that most people have not fully absorbed. Transaction volumes have doubled, from 2,087 million in 2019 to 4,472 million in 2024, while transaction value has nearly tripled from ₹7.1 trillion to ₹20.4 trillion. At the same time, debit card volumes have collapsed by 65%.

What happened is straightforward once you see it. UPI absorbed everything small and daily, the morning chai, the auto fare, the grocery run, and did it so seamlessly that carrying cash or swiping a debit card became unnecessary for most urban Indians. Credit cards moved in the opposite direction, claiming the high-value lane: flights, hotels, large appliances, luxury retail, international dining, and the kind of aspirational spending that a younger, more confident professional class was increasingly comfortable putting on credit. 

The EMI culture did the rest, allowing large purchases to sit comfortably across monthly installments without the friction of a formal bank loan. India has graduated from a country that viewed credit with suspicion to one that has made it a lifestyle instrument.

But rewards are shrinking as the market grows

India’s credit card market has grown rapidly, but most of that growth has come from new users entering the system, not from existing users spending more. But rewards programmes have become much less profitable for banks.

First, defaults are rising. Credit card NPAs rose 28.4% in the year ending December 2024, increasing lending costs for banks.

Second, RBI regulations have become stricter. Banks now need to hold more capital against credit card loans, leaving less room to fund generous rewards.

Third, fewer people are carrying unpaid balances month to month. Before the pandemic, over 40% of users revolved their balances. Today that number is closer to 23–25%, meaning banks earn less high-interest income that once funded rewards.

UPI has added more pressure. RuPay credit cards linked to UPI now account for a large share of transactions, but payments below ₹2,000 carry almost no interchange fee, reducing income for banks.

Put together, the economics of generous rewards programmes no longer work the way they once did. So banks kept acquiring new users while quietly reducing benefits for existing ones. Lounge access now comes with spending thresholds, cashback caps are lower, transfer partners disappear more often, and reward points expire faster than before.

Privileges premium credit card holders still have access to

Banks have mostly cut the benefits that were automatic, free lounge entry, uncapped cashback, airline partners. What they have not cut are the benefits most cardholders never used in the first place. Travel insurance, hotel memberships, golf privileges, these are still sitting in your card, largely untouched.

The table above shows the top six cards, but the real question is not which card is best, it is whether your points are spread across enough banks that one programme changing its terms does not leave you stranded.  Most people use one credit card for everything because it is simple. But that usually means missing out on rewards. Different cards are good for different categories. A flight booked through HDFC Infinia’s SmartBuy portal can earn far higher rewards (33%)  than booking the same ticket on a regular card (3%). Some cards are also much better for categories like jewellery, dining, or travel.

A simple habit helps: pick your four biggest spending categories and use the best card for each one.

It is also worth tracking annual spending milestones. Cards like HDFC Diners Black offer bonus points once you cross certain spending thresholds.  HDFC Diners Black, for example, gives 10,000 bonus points every quarter when you spend ₹4 lakh, points that can be worth more than several months of everyday earnings.

If you are close to hitting a milestone near the end of your card year, shifting a month of spending to that card can unlock rewards worth far more than the extra spend needed.

What if you lose your card?

Metal cards cost more to replace than you might expect. HDFC charges ₹3,500 to replace a lost or damaged Infinia or Diners Black Metal, a figure that caused significant backlash in the community when it was introduced. ICICI charges the same ₹3,500 for the Emeralde Private Metal. The fee was widely believed to target people replacing cards to access new Visa offers rather than genuine loss cases, and the community’s view is that a genuine fraud or theft reported immediately is likely to get the fee waived if you push for it.

Your accumulated points are safe. Replacing a card does not wipe your reward balance, points transfer to the new card.

The bigger problem is timing. Losing an Indian premium card while traveling abroad means waiting for the replacement to arrive at your home address in India. Someone then has to courier it to you. If you travel frequently and rely on one primary card, keeping a backup card from a different bank active is worth doing.

Tools worth bookmarking

1) Points.casa transfer calculator: Shows exactly how many miles you get when moving points between programmes. Before deciding whether to transfer Magnus points to KrisFlyer or Skywards, run the comparison here first.points.casa/tools/transfer-calculator

2) SaveSage rewards calculator: Plug in your card and spend pattern and it shows what you are actually earning versus what a different card would give you. Useful before renewing any card. savesage.club/credit-card-rewards-calculator

3) Seats.aero: For finding award seat availability. Instead of checking each airline website individually, Seats.aero shows live availability across all programmes in one search. The web version is far more powerful than the app. At roughly $10 a month, the Pro tier pays for itself on a single booking. seats.aero

People worth following (for updates on credit cards)

1) Great Indian Points and Miles Show 

2) Suvan Dural Jha I _djsuvan_

3) Manasi Jaiswal and Sanket Garg I Dobaniye

4) Aly Hajiani I thatcreditcardguy

5)Akash I  https://x.com/ccg33k

In summary

India’s credit card market has never been larger, and the engineering behind premium rewards has never been more deliberately tiered. Banks are concentrating the best benefits at the top of the spend ladder, which means the gap between cardholders who understand the system and those who do not has widened considerably. The ones who understand it are extracting disproportionate value: free business class seats, hotel upgrades, forex savings running into tens of thousands on a single trip. Everyone else is paying ₹12,000 to ₹66,000 in annual fees for benefits that changed

In summary

India’s credit card market has never been larger, and the engineering behind premium rewards has never been more deliberately tiered. Banks are concentrating the best benefits at the top of the spend ladder, which means the gap between cardholders who understand the system and those who do not has widened considerably. The ones who understand it are extracting disproportionate value: free business class seats, hotel upgrades, forex savings running into tens of thousands on a single trip. Everyone else is paying ₹12,000 to ₹66,000 in annual fees for benefits that quietly changed while they were not looking.

There is something strange about anniversaries, they make the same moment feel like yesterday and a lifetime ago at once. As I sit down to write this, I find myself thinking about where it all began: a small office in Mumbai, Vaibhav, Sahil and I, three people who had spent their careers inside wealth management, with a deep conviction that the future of this industry would be built on technology rails with the client at the centre of every decision. But none of us came from a technology background.

We did not know exactly how we would get there. But we knew it was the future, and that India’s wealth creators deserved better than what they were getting.

Five years later, that small office has become a team of 550-plus people across five cities, managing over Rs 16,000 crore for 6,800 wealth creators who trust us with their portfolios. 

This newsletter is my attempt to write honestly about what those five years actually felt like, the apprehensions before we began, the years where progress felt invisible, what we learned about building a team, about which problems to solve when everything felt urgent, and the one thing every aspiring founder underestimates. I hope some of it stays with you.

In this edition:

• One non-negotiable decision before taking the first step
• What the early years of building actually felt like from the inside
• How we found the people who built Dezerv with us
• What five years of showing up looks like in numbers
• Five things I have learned as an entrepreneur, a team leader, and a wealth manager
• Three things I would tell anyone thinking about quitting their job to build something

Let’s begin.

Before we let go of the wall

There is a moment, just before a child takes their first steps, where they are holding on to something. Not quite ready to let go. That pause is not hesitation. It is the weight of understanding, however instinctively, that once you release your grip, nothing will be quite the same again.

I lived in that pause for a while before Dezerv began.

The apprehension I carried going in was not really about whether the business would work. It was more personal: what is the implication for my family if this does not work? Because individually, I could always find a way through. But there is a lot of responsibility sitting quietly behind every decision you make as a founder. And if you do not address that directly before you begin, it follows you into every room.

So before I took any of the external steps of building a company, I did the internal work first. The portfolio got restructured during those months. Simpler, more disciplined, oriented toward stability rather than complexity. Because here is what I understood then and believe even more firmly now: if the family is secure, you can take the risks this journey demands. If the family is insecure, you are always leaning over your shoulder. And you cannot build anything worth building while leaning over your shoulder.

There is something I find meaningful about this, especially given what Dezerv is. The first act of building a wealth management company was getting my own financial house in order. Making sure that the people I was responsible for would be protected regardless of what happened next. The alignment between what we preach and what we practise starts there, at the very beginning, before anyone was watching.

The first year and the biggest challenge 

A newborn does not arrive with instructions. You figure it out as you go, with whatever combination of instinct and will you can assemble. Year one of Dezerv felt something like that.

We had a clear conviction about the problem. But conviction is not a company. The first real challenge was not finding clients. It was finding the right people to build with.

The three of us who started Dezerv came from wealth management. But we had made a non-negotiable bet that the next serious wealth manager in India would be built on technology rails. The problem was that none of us had ever operated in a technology environment. We knew it was a mega trend. We believed it was the future. But when you ask yourself where you actually begin, the honest answer is that you do not know. So the decision we made was simple: stop trying to figure it out ourselves and invest everything in finding the people who already had the answers.

But convincing people to join turned out to require something more specific than a pitch about the opportunity. There is a real difference between offering someone a business idea to chase and offering them a vision to believe in. A lot of talented people get asked to chase business ideas. Very few get asked to chase a vision.

What worked for us was being brutally transparent about the human story underneath what we were building. So in the early days, we focused on hiring missionaries, not mercenaries. Mercenaries do excellent work when conditions are favourable. Missionaries stay when conditions are not, because the mission means more to them than the circumstances. The valuation, the outcome, the money,  all of that is secondary in the hard moments.

So for us, repeatedly talking about the vision, not once in a founding document but constantly, became the most important thing we did as founders.

Learning to walk : How we figured out what to build first 

Around age two, a child starts walking. What you see from the outside looks like progress. What is actually happening is hundreds of small falls, constant recalibration, the slow invisible accumulation of balance that will eventually make walking feel effortless. 

Between years two and four of Dezerv, progress felt invisible in exactly that way. I have come to think of this as the zone of frustration, and I believe it is where most serious building journeys either hold or break.

What made the difference was learning to separate signals from noise.

When you work inside a large organisation, the organisation insulates you from a lot of this. There is always somebody telling you what matters. As a founder, all of that scaffolding disappears overnight. You have to build the filter entirely on your own. And in building it, there is an enormous amount of noise you encounter. It is very easy to drift away from your core mission without even realising it is happening.

Initially, you tend to react to everything. Then you realise that reacting to everything is counterproductive. The first shift is simply appreciating that 99% of what you hear is noise. The signal is rare. 

The second shift is developing a test for what survives that filter. The question I kept coming back to was this: is what I am seeing a permanent shift, or a temporary adjustment? An investor says no, but what is the actual reason? If the reason is temporary, you note it and keep moving. If there is something genuinely fundamental in what they are saying, you sit with it seriously. That distinction, applied consistently under pressure, is one of the harder and more valuable things I have learned.

From first steps to full stride: How far we’ve come

Watch a four year old and you will notice something. They do not just walk anymore. Everything is a run. The uncertainty of the early steps is gone, replaced by a kind of joyful momentum that looks almost reckless from the outside but is actually the product of thousands of hours of quiet practice finally clicking into place.

By year four, Dezerv felt something like that.

Clients who had joined us early were referring to people they trusted. In wealth management, that is the only signal that truly matters. The moment someone calls a friend and says, these are the people I trust with my money. You cannot manufacture that. You can only earn it, repeatedly, through how you show up week after week.

Today Dezerv manages over Rs 16,000 crore in assets across AIF, PMS, and Distribution. Over 6,800 wealth creators trust us with their portfolios. Our team of 550-plus people works across Mumbai, Bengaluru, Delhi, Hyderabad, and Pune. This is what genuine commitment looks like when it is repeated for five years.

To someone thinking about leaving a stable career to build something

The first is that if the idea is genuinely bothering you, the discomfort of not trying will outlast the discomfort of trying. The version of yourself that never attempted the thing you believed in will carry that weight in ways that are hard to anticipate from the outside. I believe deeply in what Bezos called regret minimisation,  the simple practice of asking which version of yourself, at the end of things, you can live with. For most serious people who have a serious idea, the answer points in one direction.

Before you take the leap, do the work to secure the people who depend on you. Not out of fear, but because the boldness that building requires is simply not available to someone carrying unresolved anxiety about the people they love. That clarity is not caution. It is the foundation for real courage.

And finally, these are long journeys. Not a few hard years followed by some settled phase where things get easier. Decades of compounded effort, where the early decisions echo for years and the values you hold at the beginning either prove true or prove hollow under the pressure of growth. The people who build something lasting are not the ones who pushed through the hard parts of willpower. They are the ones who fell in love with the process itself.

Thank you for growing with us

None of what Dezerv has built happened because of a plan on paper. It happened because thousands of people extended their trust before the evidence fully justified it.

The clients who came early, when we had conviction but no track record. The team members who chose the mission over certainty. The partners, Premji Invest, Elevation Capital, Z47, and Accel, who believed at stages when belief required more than evidence could support.

Trust in this business is not something you earn once. It is something you earn continuously, through every newsletter, every portfolio review, every conversation that starts with a client’s real question rather than a product pitch. That is the work we signed up for. It remains the most meaningful work I have done.

Five years in. A long way still to go.

The weeks that followed were disorienting for everyone who knew him. But somewhere beneath the grief, a very practical question began to surface,  one that his family had to face whether they were ready to or not.

How long could they sustain that life? And unlike most families where expenses can be trimmed in a crisis, this family’s most significant costs were non-negotiable. The income was gone. The obligations remained. I have thought about that family a great deal since. Not just in sadness, but in the unsettling recognition that what they are facing is a concentrated, accelerated version of a question most of us never properly answer.

If your income stopped tomorrow, how long could your life continue?

In this edition:

• Why income loss is more common than we think.
• Understanding why sudden income disruption and retirement are structurally the same financial problem.
• The real cost of living: How 6% inflation doubles your expenses every 12 years.
• The ₹100 Crore reality check
• The SRP Framework: How to calculate your three most critical numbers
• Practical steps to strengthen your financial structure so it survives even when the income engine stalls.

Income loss comes in many forms

Every SIP you run, every EMI you service, every insurance premium you pay, every goal you save for. All of it is powered by one thing. The money that lands in your account every month. Take that away, and everything downstream breaks. Not slowly. Suddenly.

And income can stop for more reasons than most of us want to think about.

The death of a primary earner is the most extreme version. But it is not the only one. A cancer diagnosis that sidelines you for two years. A business that fails and takes personal savings with it. A layoff in a restructuring. Financial fraud. A divorce that splits assets and creates new liabilities. Even the slow version counts. An industry that shrinks. Earning power that drops 40% without anyone noticing.

None of these are rare. All of them land on households designed for continuity, for income flowing month after month, indefinitely. The disruption reveals that most of us built for the expected scenario, not the realistic range.

So the question is not whether disruption can happen. It is whether your financial architecture can survive it.

Why income disruption and retirement planning are structurally the same problem?

Most people dramatically underestimate how long their money needs to last. Average life expectancy in India has crossed 71 years. For anyone retiring at 60 in reasonable health, planning to 71 is dangerously optimistic. The realistic planning horizon is 25 to 30 years, and for a couple, it’s longer still.

For a couple at 85, there is a 71% probability that at least one person reaches 85. A 44% probability that at least one reaches 90. That is not a statistical tail risk,  that is a near-certain 20 to 25 year financial obligation beyond retirement.

The implication is significant. A couple planning retirement together should plan for the longer of their two life expectancies, not the average, and not the individual. Planning for the average means half the population runs out of money while still alive.

This is why income disruption and retirement planning are structurally the same problem. The question is identical: how does a finite corpus meet rising expenses over a long and uncertain timeline, without being exhausted before the obligation ends?

Then there is inflation 

What does inflation actually do to your runway?

Two things are certain in life: death and taxes. What’s less certain is when the first arrives, and how ruinously expensive the wait will be.  The assumption that derails most financial plans is treating expenses as roughly stable. They are not. They compound, and they compound faster than most people expect.

At 6% annual inflation,  a reasonable baseline for Indian household expenses, your monthly requirement roughly doubles every 12 years. What costs ₹1,50,000 per month today will cost approximately ₹4,81,000 per month in 20 years:

Healthcare is a separate and more severe curve. Hospital services have historically grown far faster than general inflation. In India, medical costs have risen at 12 to 15% annually for years. And critically, healthcare’s share of household spending increases with age: from around 8.6% of income at ages 55-64, rising to over 13.2% at 65 and beyond,  and continuing to climb.

They compound faster than almost any other household expense, and they are among the least reducible in a crisis. The practical consequence: the corpus that appears adequate when calculated in today’s rupees may be seriously inadequate in the rupees of 15 or 20 years from now. 

The retirement corpus reality check

Assume you are 45 today. You plan to retire at 60. Healthcare and lifestyle inflation runs at 10% annually. The question is not how much you have, it is how much you will need at 60 to sustain your current lifestyle for 30 years:

A ₹5 lakh monthly lifestyle today needs roughly ₹100 crore at the starting line of retirement. Not to grow wealthy. Not to leave a legacy. Just to not run out. The number is achievable. Not through luck or extraordinary returns. Through one variable that most people are squandering every year they wait. Time.

Consider this exercise. Same starting corpus of ₹1 crore. Same target of ₹20 crore. The only thing that changes is when you begin.

Waiting 10 years multiplies the required monthly SIP by 13 times. And the SIP hockey stick below shows why,  the last decade of compounding generates more wealth than the first two combined:

Note: This is for illustrative purposes only

The first twenty years of investing build 24% of the final corpus. The last ten years build the remaining 76%. When you delay by a decade, you are not just losing ten years of growth. You are cutting yourself off from the only part of the curve that was going to do the real work.

How to think about your portfolio in a disruption

A portfolio that looks adequate on paper can behave very differently when withdrawals begin early, markets are down, or an unexpected expense lands at the wrong moment.

If your portfolio drops 20% and you simultaneously withdraw 10% — which income disruption forces you to do, you now need a 39% gain just to return to where you started. You have not just lost money. You have permanently shrunk the base from which recovery has to happen.

The instinct is to de-risk, move to fixed income, play it safe. That instinct is historically backwards. Over 90% of portfolio return variability is explained by asset allocation alone, not fund selection or market timing.

Note: This is for illustrative purposes only

Conservative versus Growth: same market, same timeline, three times the outcome.
The person who played it safe did not protect themselves, they chose a different kind of risk. The slow, quiet risk of a corpus that cannot outpace inflation and runs out while they are still alive. For any long-horizon investor, voluntary retirement at 60 or forced disruption at 44,  the real risk is not short-term volatility. It is outliving the corpus.

The SRP framework: Three numbers every family should know

Most people ask: ‘Do I have enough?’ But enough for what? Enough for retirement? Enough if something goes wrong? Enough if I need to protect my family for 40 years? These are different questions. They need different numbers. Here is a cleaner way to think about it,  three numbers, each answering a different question:

Where most families actually stand

Based on portfolio reviews at Dezerv, this is what we typically find:

Most families are exposed to all three simultaneously. The Survival Number is dangerously thin. The Replacement Ratio is nowhere near the target. And the Protection gap is large enough that a single event would change the family’s financial trajectory permanently.

Building the Chassis

You cannot prevent income loss. That is often outside your control. But you can build a financial structure strong enough to survive it,  a chassis that holds even when the engine fails. Most people over-invest in the engine and under-invest in the chassis. A ₹1.5 crore per year earner with ₹80 lakh in savings and a ₹1.2 crore home loan has a powerful engine on a fragile frame.
One shock and the whole vehicle breaks.

1. Fund your survival number first: Financial experts often suggest maintaining a survival corpus equal to 24 months of household expenses in highly liquid assets. This is not an investment. It is a shock absorber. It buys you time to think clearly instead of selling in panic.

2. Fix your protection number: Many households choose to evaluate their life cover to ensure it adequately bridges the gap between their assets and future liabilities. It is the cheapest way to ensure the hockey stick survives even if you do not. Add critical illness cover. Being alive but unable to earn for two years is financially more devastating than death.

3. Build your replacement ratio deliberately: Your Replacement Number should climb every year. Dividends, rental yield from REITs, systematic withdrawal plans. The goal is that by 55, your portfolio can generate 70% of your expenses without your salary.

4. Have the conversation with your spouse: Do they know where the assets are? Who is the advisor? Can they access accounts? Is there a documented plan they can follow? This is not glamorous. It is life saving.

5. Diversify your concentration risk: If your income and your largest asset are both tied to the same company, through salary and ESOPs, a single corporate event can destroy both simultaneously. Diversify before the shock. Not after.

In summary

The ₹100 crore retirement number assumes you show up at 60 with a fully funded portfolio. It assumes 15 to 20 years of uninterrupted compounding. It assumes the engine never stalls.

For most of us, that assumption will hold. For some of us, it will not. Nobody knows which group they are in. The goal is not to prevent income loss. That is often outside your control. The goal is to build a financial life that can coast long enough for the engine to restart, or for a new one to take its place. Calculate your three numbers. Fix the gaps while you still have the income to close them. The most important financial skill is getting the goalpost to stop moving. It’s not about earning more. 

Disclaimer – Investment in the securities market is subject to market risks, read all the related documents carefully before investing. The information provided herein is intended solely for educational purposes and should not be construed as solicitation, advertising, or providing any financial or investment advice or an offer to buy or sell any financial instruments. Any illustrations, charts, or compounding graphs shown are for illustration purpose and do not in any manner offer any assured returns and are subject to market risks. Any statements about future developments are speculative and should not be taken as guarantees. Readers are advised to consult with their financial advisor before making investment decisions based on the information provided herein.

In the preparation of this document, Dezerv has used information developed in-house and publicly available information and other sources believed to be reliable. The information is not a complete disclosure of every material fact and terms and conditions. While reasonable care has been made to present reliable data in this article, Dezerv does not guarantee the accuracy or completeness of the data. The information / data herein alone is not sufficient and shouldn’t be used for the development or implementation of an investment strategy.

Any references to names of fund houses, investment securities, or asset classes are for illustrative purposes only. Dezerv, along with its directors, employees, or partners or any of its affiliates, shall not be held liable for any loss, damage, or liability arising from the use of this document. Additionally, all trademarks, logos, and brand names mentioned are the property of their respective owners and are used for identification purposes only. The use of these names, trademarks, and logos does not imply endorsement or recommendation.

In FY26, over 50% of homes sold across India’s top 7 cities (excluding Mumbai) were priced at ₹1.5 crore or higher.

Think about that for a moment. For decades, “affordable housing” was the centrepiece of every urban policy debate in India. Subsidies, priority lending, government schemes — the entire system was built around the premise that India was a nation of budget buyers. That narrative is dead.

In FY16, the affordable and mid-end segments powered 74% of residential absorption. Fast forward a decade to FY26, luxury and ultra-luxury represent 53% of the market. The affordable segment’s share has been cut in half. Ultra-luxury demand has nearly tripled.

But here’s what’s most interesting to me: the real story isn’t that Indians aren’t buying homes. It’s that the profile of the Indian who is buying has changed entirely. And the second-order effects of that shift — on rents, on banking, on cities themselves — are still underappreciated.

In this edition, we’ll cover:

• The structural shift from a volume-led to a value-led market
• What’s really driving the luxury boom — GCCs, ESOPs, and a new class of wealth
• Why affordable housing is quietly disappearing from Tier-1 supply
• The rent paradox: rents up 24%, yields flat
• Why banks are writing bigger cheques to fewer people
• What all of this means for your portfolio in 2026

Let’s begin!

The volume – value reversal: a market splitting in two

For most of India’s post-liberalisation history, residential real estate was a volume story. Build as many homes as cheaply as possible, and the market would absorb them. That model worked in an economy where most households earned below ₹15 lakh a year, saved aggressively, and viewed homeownership as the primary financial milestone.

That thesis has broken. The market today is both cooling and booming — depending entirely on which segment you examine.

The mid-range segment (₹50L– ₹1Cr), once the core of India’s housing market, is down 40% year-on-year in sales. Affordable housing has almost disappeared from Tier-1 cities. In contrast, homes priced above ₹1.5 crore are still growing, with the ₹3 – ₹5 crore segment up 14%.

The demand is migrating. The buyer who can afford to buy has moved up the price ladder. The buyer who cannot has been priced out entirely. 

The supply-demand data reinforces this divide. Developers, still operating on the optimism of prior years, continue to launch. But mid-market absorption has slowed. The system is no longer clearing inventory at the same pace.

At the aggregate level, the slowdown is visible.The RBI’s House Price Index shows annual nationwide price growth decelerating from 7% to 2.2% by Q2 FY2025–26. By conventional metrics, momentum has faded. And for a large portion of the market, it has.

But averages mask composition. When high-value transactions dominate deal flow, the average price rises — even if underlying breadth is weakening. That is precisely what we are seeing. Transaction data across leading cities shows rising average ticket sizes, driven by a narrower cohort: GCC professionals, liquidity-rich founders, and HNI investors operating at the premium end.

The buyer profile has fundamentally shifted. Rate-sensitive middle-class demand has retreated. What remains is a thinner, wealthier cohort that is less bothered by EMI calculations and more focused on asset quality, location, and long-term capital appreciation. The market has not crashed. It has simply gotten more exclusive.

The three engines powering the luxury boom

Every market cycle has a structural driver. This one has three, and they are reinforcing each other in ways that I don’t think are fully appreciated yet.

1.The rising income inflection

There is a precise economic threshold behind the luxury housing surge — and it is not arbitrary. Historically, when per-capita GDP sits below $2,500, spending is almost entirely captured by needs: food, basic shelter, and essentials. India currently sits at approximately US$2,500 per capita. We are right at the inflection point.

Once incomes cross the $3,000 mark, the housing and home-upgrade cycle does not grow linearly — it explodes. At this level we see a massive acceleration toward real estate and ancillary segments — including building products and home improvement. This also explains why luxury housing is currently defying broader market trends.

The demand base itself is deepening. India now has over 13 lakh HNIs. And wealth remains highly concentrated — the top 1% of households control nearly 60% of total wealth, according to the Bernstein report 2025. That concentration matters.

Dual-income nuclear families, tech-driven entrepreneurship, and GCC-linked compensation structures are expanding the pool of households with genuine surplus capital. We are moving from a nation of savers to a nation of sophisticated consumers — and that shift is arriving faster than most supply-side analysis accounts for.

2.  The GCC flywheel

A tech lead at a Bengaluru GCC (Global Capability Centres) may earn around ₹25–60 lakh a year. She isn’t buying what her parents bought. She wants a gym, a co-working lounge, EV charging, and smart-home automation. Not as upgrades — as baseline expectations. This demand isn’t aspirational. It is income-driven.

Nearly 2 million people work in India’s GCC today. By 2030, that number will touch 2.8 million. These aren’t back-office roles anymore — global companies are planting their actual nerve centres here. R&D, product, strategy. The GCC count has jumped from 1,285 in 2019 to over 1,700 today, heading past 2,400 by decade’s end.

Bengaluru alone captured more than one-third of the country’s total GCC leasing in 2025.  The flywheel is spinning. And what it’s producing, at scale, is a new kind of homebuyer — one the Indian residential market is still learning to serve.

3. The ESOP and IPO effect

India’s startup ecosystem has quietly created its first generation of genuine early-stage wealth. ESOP liquidations — which we’ve analysed at a ₹14.2 lakh crore opportunity — and IPO proceeds have created a buyer who doesn’t need a 20-year home loan. They can put down 50% upfront or pay outright.

Swiggy’s 2024 IPO alone unlocked $1 billion for over 5,000 employees. Zomato, Nykaa, Policybazaar together added another $3.3 billion. These are not small numbers. A portion of that liquidity is finding its way into real estate — specifically, the premium tier.

This cohort is skipping the starter home entirely and entering the market at the luxury rung. It is a fundamentally new buyer pattern in India.

4. Post-COVID psychological shift 

Post-pandemic, the psychology of the Indian buyer has shifted from need to aspiration. The home is no longer just a place to sleep; it is a multifunctional space that must accommodate a home office, a gym, and a creative studio. 

But it goes deeper than function. There’s an emotional recalibration happening. People who spent months locked inside their homes came out the other side with a sharper sense of what they actually wanted their lives to look like — and the home became the primary canvas for that

Why affordable housing Is quietly disappearing

The affordable segment’s share of demand has collapsed from 52% in 2018 to just 17% today. At the same time, new launches in this category are down 28%.

So It’s not just a demand problem. India has tens of millions of households who want to buy an affordable home. It is a supply problem driven by the economics of building one.

Since 2020, construction costs have surged 35–40%. Land now accounts for 30–50% of total project costs in major cities, and because Indian banks cannot fund land acquisitions, developers borrow privately at 18–22% annual interest. To justify that cost of capital, they must build units commanding a high per-square-foot price.

The government’s own definition of “affordable housing” — capped at ₹45 lakh — has become dangerously outdated. Finding a decent 2BHK below that threshold in Bengaluru, Pune, or Delhi NCR is nearly impossible today. Yet cross that threshold and developers lose their GST benefit, dropping from 1% to 5%. With margins already thin, the rational decision is to stop building.

The deeper consequence is urban stratification. Essential workers are being pushed to the periphery, commuting further for the same jobs that are generating the luxury demand they cannot access. 

Why can’t we just build more?

The constraint in India is not land. It is a lack of FSI — Floor Space Index, the ratio which determines how much can be built on a plot. And by global standards, India is severely restricted. India’s major cities operate with some of the lowest FSI ceilings in the world.

Low FSI forces sprawl. Developers move outward where land is cheaper, but infrastructure lags. Core city land becomes artificially scarce — and therefore unaffordable.

And when core-city supply is structurally constrained and ownership becomes unaffordable, households don’t disappear — they shift to renting.  Every household priced out of buying becomes a long-term renter. 

Low FSI forces sprawl. Developers move outward where land is cheaper, but infrastructure lags. Core city land becomes artificially scarce — and therefore unaffordable.

And when core-city supply is structurally constrained and ownership becomes unaffordable, households don’t disappear — they shift to renting.  Every household priced out of buying becomes a long-term renter. 

The rent paradox

So If you’re a landlord right now, the headline numbers look excellent. Rents were up 23.6% year-on-year as of Q4 2025. Delhi led at 27.8%, Kolkata at 39.6%, Mumbai at 19.3%. That is extraordinary rent inflation by any measure.

But look past the headline and the picture becomes more nuanced. The cities with the biggest rent jumps are not producing the best rental yields. Mumbai and Bengaluru — where prices have run furthest ahead of rents — are yielding just 3.3 – 3.9%. Chennai, Hyderabad, and Ahmedabad, where property hasn’t been bid up as aggressively, offer gross yields above 3.9%.

The real estate truism holds: capital appreciation and rental yield are frequently in tension. When a market runs on price appreciation narratives, buyers pay up for the asset and compress the yield. Right now, India’s tier-1 cities are in that compressed-yield phase.

The structural case for rental demand is solid — India’s urban population is rising, supply is tight, and more middle-class households are choosing to rent as buying becomes unaffordable.

Bigger loans, fewer borrowers

Here is a data point that tells the story of this entire cycle in a single line: India’s home loan market grew from ₹11.9 lakh crore to ₹19.3 lakh crore in four years. Yet the number of unique borrowers actually fell — from 27.3 crore to 26 crore.

The RBI cut the Policy Repo Rate by a cumulative 100 basis points between February and June 2025, bringing home loan rates below 8% for the first time since 2022. This was supposed to be the affordability catalyst. It has not worked in the affordable segment — at least not yet.

Origination value is still growing — up 2.7% in FY25 — but volume has declined 5.4%. What that tells us is unambiguous: loans are getting larger, not more numerous. Credit is concentrating upward into high-income professionals and higher-ticket properties (₹75 lakh and above), while sub-₹35 lakh lending has effectively collapsed.

The rate cuts I feel  have helped sentiment more than they’ve helped affordability. The primary constraint on the affordable segment isn’t the interest rate — it’s the price of the underlying asset. A 50 bps cut does little when property prices are going rising at double-digit rates. 

The banking opportunity hidden inside

For banks, the premiumisation of real estate is actually a tailwind. High-income borrowers have significantly lower default probability, and the shift toward larger loans compensates for lower volume. Gross NPA ratios at Scheduled Commercial Banks fell to 2.22% as of September 2025 — a multi-decade low. Net profit for SCBs reached ₹4.01 lakh crore in FY25, up from ₹3.5 lakh crore the previous year.

The banks with the best exposure to premium mortgages — ₹2 crore and above — are quietly benefiting from the same structural shift that is squeezing affordable housing. Fewer borrowers, larger loans, lower delinquency. It is a better book, even if it is a smaller one.

What does this mean for you?

Every structural shift of this scale creates an investable universe that extends far beyond the obvious play. Most people think of the luxury housing boom and immediately jump to listed real estate developers. That is one part of the picture — but not the most interesting one.

Where the real opportunity sits

Premium Real Estate Developers. Focus on those with strong balance sheets, low debt, and projects concentrated in Bengaluru, Hyderabad, and NCR premium micro-markets. The cycle favours execution quality over volume.

Building Materials and Smart Home Tech. As ultra-luxury becomes the baseline expectation, the specification upgrade cycle will run for a decade. Companies supplying smart-home systems, EV charging infrastructure, premium fittings, and wellness amenities are quietly riding this wave.

Buy-to-Let in the Right Micro-Markets. Rental yields in Bengaluru and Hyderabad are currently at 2.5–3.5% — still thin relative to borrowing costs. But in Chennai, Ahmedabad, and select Pune markets, yields above 3.9% are available with realistic appreciation potential. The buy-to-let case in India is becoming real for the first time.

Banks Targeting Premium Mortgages. Lenders with a growing book of ₹2 crore+ loans and sub-2.5% NPA ratios are structurally advantaged. Lower provisions, higher margins, lower volatility.

The common thread across all of these is the same underlying dynamic: purchasing power in Indian urban real estate is concentrating, not diffusing. The investable universe isn’t just the developers — it’s everything that feeds, finances, furnishes, and manages the ecosystem they’re building.

The longer view: space as the scarce resource

There is a structural argument for India’s real estate that goes beyond any single cycle, and I want to leave you with it.

The average Indian currently lives in roughly 130 square feet of built space. The equivalent in smaller Chinese cities is approximately 550 square feet. In the US, it is close to 700 square feet. As incomes rise, people don’t eat meaningfully more food — but they consistently demand more space.

This gap is not going to close quickly. Land constraints, restrictive FSI regulations, and a decade-long underinvestment in affordable supply mean the structural demand for premium residential space will run well beyond this cycle.

The luxury boom isn’t a bubble, in my view. It is the early expression of a permanent recalibration in how India’s professional class thinks about where and how it lives. The question isn’t whether to pay attention to real estate — it’s whether you’re positioned in the right part of the market when the next wave arrives.

In summary

India’s residential real estate market has crossed a threshold from which it will not easily return. The majority of transactions in the top cities are now in the luxury bracket. Affordable supply has structurally collapsed. Rents are rising sharply but yields are compressed in the cities that have appreciated most.

The forces driving this shift — GCC-driven income concentration, ESOP and IPO liquidity, dual-income households, rising HNI counts — are structural, not cyclical. They will not reverse when interest rates move or when markets correct.

For wealth creators, the lens should shift accordingly. This is no longer a market you analyse for affordability metrics. It is a market you analyse for where purchasing power is concentrating, and what ecosystem benefits from that concentration.

The volume story is over. The value story is just beginning.

Disclaimer – The information provided herein is intended solely for educational purposes. In this material, Dezerv has utilized information through publicly available sources, and other data deemed to be reliable. All trademarks, logos, and brand names mentioned are used for identification purposes only and do not imply endorsement or recommendation.

Here’s what these legendary taglines have in common: simplicity. None are complex because simplicity drives adoption at scale. This is beautifully visible in how India has embraced mutual funds.

Consider the transformation: In 2014, individual investors owned less than 3% of mutual funds in India’s equity markets. Today, that number stands at 9.2%. In rupee terms, household equity holdings through mutual funds have exploded from ₹2 lakh crore to nearly ₹41 lakh crore—an annualized growth rate of 29.4%, comprising one fifth of India’s GDP.

This week, I’m writing about my favorite asset class—and judging by the numbers, that of India’s too: Mutual Funds.

In this edition, we’ll cover:

• The quiet revolution in Indian household savings
• How India compares to global peers—and the runway ahead
• The SIP phenomenon and rise of direct plans
• The new challenge: Solving for ASAR

The Savings Shift That Changed Everything

For decades, the average Indian household had a simple relationship with money: earn it, park it in a fixed deposit or real estate, and forget about it.

Then something remarkable happened.

Between 2019 and 2024, the share of equity and investment funds in Indian household wealth jumped from 16% to 22%. In a country of 1.4 billion people, that’s a fundamental rewiring of how an entire generation thinks about money.

The fixed deposit is losing its iron grip. The ratio of bank deposits to mutual fund AUM has collapsed from 6.5x in 2012 to just 2.2x today.

Zoom out further, and the shift becomes even starker. Total household assets in India now stand at ₹1,300-1,400 lakh crore. In FY15, physical assets—primarily real estate—dominated at 66%. Investable assets were a mere 28%. By FY25, investable assets have climbed to approximately 35%, growing at 17% CAGR.

What’s driving this? Demonetization curbing cash-heavy real estate, millennials preferring renting over buying, and growing awareness that real estate returns of ~6% over 15 years pale against 10-12% equity returns.

The India Gap: Runway, Not Deficit

The global comparison is illuminating.

In the US, mutual funds alone account for 28-33% of household investable assets. Add direct equity (non-promoter holdings of 16-19%), and American households have nearly half their investable wealth in equity-linked instruments. Canada and the UK show similar patterns—40-45% in deposits, but substantial allocations to mutual funds (25-27% and 13-15% respectively).

India? We’re at 7-10% in direct equity and 30-35% in mutual funds. Our deposit addiction remains strong at 45-55% of investable assets.

But here’s what the developed market comparison misses: the pace of change. The US built its equity culture over decades, aided by 401(k) integration with mutual funds, attractive tax incentives, and widespread corporate equity plans like ESOPs and ESPPs.

India is compressing that journey. Our financial literacy is still catching up, our ESOP culture remains limited to startups and large firms, and yet we’re witnessing a financialization of savings that took the West generations to achieve.

Domestic Investors Come of Age

For years, India’s markets danced to a foreign tune. When FIIs bought, markets rose. When they sold, panic ensued. The ownership gap between foreign and domestic institutions was 19 percentage points in 2014.

Today? Under 6 percentage points.

Domestic mutual funds now hold nearly 11% of all listed equities, up from 3.4% a decade ago. In 18 consecutive quarters, DIIs have been net buyers. When global uncertainty triggers foreign outflows, Indian markets don’t collapse anymore. Domestic investors absorb the shock.

The SIP Revolution

In 2017, average monthly SIP inflows were ₹3,600 crore. By September 2025, that crossed ₹29,000 crore. Monthly.

Millions of Indians now set aside money every month with the discipline of paying a utility bill. Mutual fund folios have grown at 19% annually since 2020, crossing 25 crore accounts.

SIP isn’t a product anymore, it’s become a habit.

The Rise of Direct Plans

Perhaps no trend better captures India’s evolving investor sophistication than direct plans.

Direct plans have grown because investors are increasingly cost-sensitive and can clearly see the long-term impact of higher expense ratios on returns.

At the same time, trust has shifted away from commission-led distribution due to perceived conflicts of interest.

As investing has become more execution-first and data-driven, many investors prefer a self-serve, transparent route—driving the rise of fintech platforms and direct channels in the AUM mix.

Below is a line-level rewrite of your closing section — from “The New Problem: From Stock Picking to Fund Picking” through the end. I’ve kept your voice and structure, but tightened the prose, made ASAR more “operator-mode,” and added one or two truth-serum lines so it feels more credible to a time-poor Indian wealth creator.

The New Problem: From Stock Picking to Fund Picking

Here’s where I want to pause.

Everything we’ve discussed is genuinely exciting. But for wealth creators like you, a new problem has quietly emerged.

Mutual funds were invented to solve a simple pain: stock picking is hard. So we outsourced it to professional fund managers. Problem solved.

Except now we’ve created the next layer of complexity.

India has 1,800+ mutual fund schemes, 40+ AMCs, and a growing set of categories and sub-categories. We solved stock picking by creating a fund-picking problem.

For India’s ambitious wealth creators—money-rich but time-poor—this creates real friction. The question is no longer “Should I invest in mutual funds?” It’s:

“How do I navigate the mutual fund universe intelligently—without turning investing into a second job?”

The ASAR Framework

Successful mutual fund investing comes down to four pillars:

Access. Selection. Allocation. Review.

A — Access

The first hurdle is cost.

Regular plans come with embedded commissions that quietly compound against you. Even a ~1% annual difference in costs can meaningfully dent your long-term corpus over a 15–20 year horizon.

Direct plans solve the cost problem—but they often push you into DIY territory. And without a process (or the right guidance), you’re back to square one.

A simple way to think about it:

• Pay for advice, not distribution.
• Minimize product cost (expense ratio) and maximize decision quality (process).

S — Selection

With 1,800+ schemes, “choosing funds” can become its own form of overthinking.

Past performance is noisy. Star ratings change. Fund managers change. Styles drift.

Most wealth creators end up in one of two traps:

• Too few funds → concentration risk, style risk
• Too many funds → overlap, clutter, and no real accountability
  (Yes, the “128-fund portfolio” is real—and it’s more common than you’d think.)

Selection needs a rulebook, not vibes. At a minimum, your selection process should answer:

• What role does this fund play in my portfolio? (core / satellite / debt / goal-linked)
• Is the strategy consistent and repeatable?
• Do I already own something that behaves the same way?

A — Allocation

This is where wealth is actually built (or quietly leaked).

Your allocation decides:

• how much volatility you’ll tolerate,
• how tax-efficient your portfolio becomes,
• and whether you’re set up for staying invested when markets get ugly.

Allocation isn’t a one-time decision. Markets change. Goals evolve. Life happens. Your portfolio has to keep up—without becoming messy.

A good allocation is simple enough to maintain, and robust enough to survive cycles.

R — Review

This is where most investors fail: they invest and forget.

Review doesn’t mean daily checking. It means systematic evaluation, with clear triggers:

• Are funds performing against benchmarks and category peers over a meaningful period?
• Has the fund’s role in the portfolio changed due to market moves?
• Has my allocation drifted enough to require rebalancing?
• Have my goals, cash flows, or timelines changed?

The wealth creators who build lasting portfolios aren’t the ones who “picked the best fund.”

They’re the ones who built a review mechanism that course-corrects before small mistakes become expensive ones.

In Summary

India’s mutual fund industry has moved from niche to mainstream.

Individual participation has surged. Domestic investors now meaningfully counter-balance foreign flows. SIPs have scaled into a national habit. Investable assets are rising as household behavior rewires.

“Mutual Fund Sahi Hai” wasn’t just a tagline. It was a promise—and the numbers suggest that promise is being kept.

But for wealth creators, the next chapter isn’t just about participating.

It’s about navigating intelligently.

Access. Selection. Allocation. Review.
Get these four pillars right, and mutual funds stop feeling overwhelming—and start feeling empowering.

The revolution has already happened.

The question is: do you have a system to benefit from it?

Disclaimer – Mutual Fund investments are subject to market risks, read all scheme-related documents carefully. The information provided herein is intended solely for educational purposes and should not be construed as solicitation, advertising, or providing any financial or investment advice. Readers are advised to consult with their financial advisor before making investment decisions based on the information provided herein.

In the preparation of this document, Dezerv has used information developed in-house and publicly available information and other sources as mentioned herein which are believed to be reliable. The information is not a complete disclosure of every material fact and terms and conditions. While reasonable care has been made to present reliable data in this article, Dezerv does not guarantee the accuracy or completeness of the data and the data provided shouldn’t be used for the development or implementation of an investment strategy.

Dezerv, along with its directors, employees, or partners or any of its affiliates, shall not be held liable for any loss, damage, or liability arising from the use of this document. Additionally, all trademarks, logos, and brand names mentioned are the property of their respective owners and are used for identification purposes only. The use of these names, trademarks, and logos does not imply endorsement or recommendation.

Sources – Bain and Co. How India Invests 2025 Report, National Stock Exchange Pulse November 2025

I entered my age. The number that appeared: 82,000 hours.

Here’s the link in case you want to check how many years AI could cut from your career.

That’s roughly 10 years of full-time work that AI could compress, automate, or render obsolete before I reach the traditionally “retirement age.”

But here’s the shocking part: this AI replacement is already in motion. Just this week, Accenture laid off 11,000 employees as a part of its AI transition. And the implications for how we think about retirement, wealth creation, and financial security are profound.

Welcome to this week’s edition of the Create Wealth newsletter, where we explore a reality most wealth creators aren’t yet accounting for: you might work fewer years than you planned, but you’ll almost certainly need to fund far more years than your parents did.

In this edition, we’ll cover:

• The AI compression effect: Why your career timeline is shrinking
• The longevity paradox: Living longer with less earning time
• The new retirement math: 30 years to fund, not 15
• Healthcare inflation: The silent wealth destroyer
• Financial resilience in the age of AI: What actually works

Let’s begin.

The AI compression effect: Your career timeline is shrinking

For decades, retirement planning followed a predictable formula: work from 25 to 60-65, then fund 15-20 years of retirement. The math was straightforward. The assumptions held.

Not anymore.

The data is stark and immediate. India’s largest private sector employer, Tata Consultancy Services, cut more than 12,000 jobs in a single announcement. Over 3,600 employees were laid off by Indian startups in just the first five months of 2025, driven by automation.

This isn’t about technology replacing blue-collar work anymore. Projections suggest that 40-50% of current white-collar jobs in India may disappear due to AI-driven automation.

Take a look below at the shocking list of % of tasks AI can do for various professions and I’m sure you can see how working professionals are going to be deeply affected. 

But here’s what makes this moment different from previous technological disruptions: the speed and the scope.

When manufacturing jobs were automated in the past, displacement happened over decades. Workers could retrain. New sectors absorbed the surplus. The adjustment period was gradual.

AI compression is happening in years, not decades.

And it’s targeting knowledge work—the very segment that India’s professional class has built wealth upon.

What does this mean for your retirement planning?

The traditional assumption that you’ll work until 60-65 is becoming obsolete. You might find yourself involuntarily retired at 55—or even earlier—not because you want to, but because your role has been automated, restructured, or redefined beyond recognition.

That’s 5-10 years of prime earning (and compounding) time you may not have.

The longevity paradox: Living longer with less earning time

While AI is compressing your earning years, medical science is extending your living years.

India’s life expectancy reached approximately 70.6 years in 2024. But that’s just the beginning. Healthy Life Expectancy (HALE) for females is projected to increase from 61.4 years in 2022 to 65.9 years by 2050, while for males it will rise from 60.8 years to 65.5 years. 

The population of people aged 80+ years in India is projected to grow at a rate of around 279% between 2022 and 2050. 

If you look at the worldwide numbers too, we can see a looming retirement crisis. This comes with its own problems, something we can delve into, in another edition perhaps.

Think about what this means: You’re likely to live longer than any previous generation in your family. But you might also stop earning earlier than they did.

This creates a funding gap that most retirement calculators don’t account for.

The old model assumed:

• Work from 25-60 (35 years of earning)
• Retire from 60-75 (15 years of expenses)
• Funding ratio: 2.3 years of work for every 1 year of retirement

The new reality:

• Work from 25-55 (30 years of earning, maybe less)
• Retire from 55-85 (30 years of expenses, possibly more)
• Funding ratio: 1 year of work for every 1 year of retirement

You need to fund twice as many years with fewer earning years. That’s a complete recalibration of retirement math.

The new retirement math: Why 30 years is the new baseline

Let me walk you through what this actually means in rupee terms.

Consider a typical affluent professional in Mumbai:

• Current age: 40
• Current annual expenses: ₹40 lakh (including rent, EMIs, children’s education, vacations, and lifestyle costs)
• Expected retirement age (traditional): 60
• Expected retirement age (AI-adjusted): 55
• Life expectancy: 85

Traditional retirement planning (work until 60):

• Years to retirement: 20
• Years in retirement: 25
• Total retirement corpus needed (at 6% inflation): ₹23-27 crore
• Annual savings required: ₹47-53 lakh

AI-adjusted retirement planning (work until 55):

• Years to retirement: 15
• Years in retirement: 30
• Total retirement corpus needed (at 6% inflation): ₹30-35 crore
• Annual savings required: ₹73-87 lakh

That’s a 30-40% increase in the corpus requirement, with 25% less time to build it.

And we haven’t even factored in healthcare inflation yet.

Healthcare inflation: The silent wealth destroyer

While general inflation in India has been moderating, healthcare costs tell a different story.

As of September 2024, the medical inflation rate in India stood at 14%, the highest rate among Asian countries including China. 

To put this in perspective: at 14% annual inflation, healthcare costs double every 5 years.

If a bypass surgery costs ₹10 lakh today, it will cost:

• ₹20 lakh in 5 years
• ₹40 lakh in 10 years
• ₹80 lakh in 15 years
• ₹1.6 crore in 20 years

Cancer treatments now cost 5-10 times more than conventional chemotherapy due to immunotherapy and targeted therapies, and COVID-19 demonstrated how quickly costs can spike, with ICU charges reaching ₹50-75,000 per day and bills of ₹15-20 lakh becoming common.

Now layer this onto an already-extended retirement timeline.

If you retire at 55 and live until 85, you’re looking at 30 years of healthcare expenses that compound at 14% annually. The healthcare portion of your retirement corpus alone could require ₹15-20 crore in today’s terms—before you account for lifestyle expenses.

While this may sound scary, it is an unfortunate reality.

Financial resilience in the age of AI: What actually works

So what do you do when both your earning timeline and retirement timeline are moving in the wrong direction?

The answer isn’t to panic. It’s to recalibrate—systematically and immediately.

Here’s what financial resilience looks like in this new reality:

1. Redefine your retirement age—now

Stop planning for retirement at 60. Start planning for involuntary career transitions at 55—or even 50.

This doesn’t mean you’ll stop working. It means you need to be financially independent enough that work becomes optional, not mandatory.

The goal: Build a corpus that can sustain you from 50-85, even if active income drops significantly after 55.

2. Front-load your savings

Traditional retirement planning assumes steady savings throughout your career. AI compression requires front-loading.

Your 30s and 40s are now your critical wealth-building decades. By 45, you should ideally have:

• 8-10x your annual expenses in investment portfolios
• Healthcare coverage of at least ₹1-2 crore (and increasing annually)
• At least 1-2 diversified income streams beyond salary

The compounding you get from aggressive savings in your 30s and 40s is what will carry you through extended retirement in your 70s and 80s.

3. Healthcare planning cannot be deferred

Healthcare planning is a wealth preservation strategy.

Key moves:

• Don’t rely only on your corporate insurance
• Super top-up health insurance beyond basic coverage
• International medical coverage for complex treatments
• Long-term care insurance (still nascent in India, but worth tracking)
• Annual health checks that go beyond routine tests—comprehensive metabolic panels, genetic screening, and preventive diagnostics

Think of healthcare planning as portfolio insurance. You’re not hoping to use it. You’re hoping it protects your corpus from major erosion.

4. Build skill resilience, not job security

AI might automate your current role. But it won’t automate judgment, relationship-building, and strategic thinking.

The professionals thriving post-55 will be those who’ve built:

• Advisory capabilities: Moving from execution to counsel
• Network capital: Relationships that create opportunities
• Platform independence: Skills that translate across industries
• Creator mindset: Ability to monetize expertise directly

Your career strategy from here should focus on becoming less replaceable, not just more skilled.

5. Portfolio construction for longevity

Your investment portfolio needs to work for 30-35 years post-retirement. That requires a different asset allocation than traditional retirement planning.

Key principles:

• Higher equity allocation even post-50(You can gradually decrease the equity allocation as per the changes in your risk appetite and life circumstances)
• Diversify your investments: Consider diversifying outside of equity – eg – REITs, gold, bonds
• Withdrawal rate: Keep in mind your cash flow requirements annually while planning your liquidity and withdrawals. 
• Always keep an emergency fund: Atleast 12 months of your annual expense and monitor any major changes closely. 

The goal isn’t just capital preservation. It’s capital appreciation throughout retirement to keep pace with healthcare inflation and longevity.

6. Multiple income streams aren’t optional

Relying on a single income source—salary—is the riskiest position in an AI-compressed career landscape.

Build redundancy:

• Consulting/advisory income from your domain expertise
• Investment income from diversified portfolios
• Passive income from real estate or digital assets
• Board positions or fractional executive roles

Each income stream doesn’t need to be large. But collectively, they create resilience if any single source gets disrupted.

The psychological shift: From optimisation to resilience

Here’s what I’ve observed working with hundreds of wealth creators: The hardest part of this recalibration isn’t financial. It’s psychological.

For decades, we’ve been conditioned to optimise—maximising returns, minimising taxes, squeezing every basis point of alpha from our portfolios.

That optimisation mindset served us well in stable, predictable environments.

But AI compression + longevity extension creates fundamental uncertainty. And in uncertain environments, resilience matters more than optimisation.

Resilience means:

• Building larger safety buffers (even if it “costs” you in potential returns)
• Accepting lower withdrawal rates (even if the math says you could go higher)
• Maintaining more liquidity (even if it drags on portfolio performance)
• Over-insuring (even if premiums feel expensive)

These moves won’t maximise your wealth. But they’ll protect your peace of mind—which, over 30 years of retirement, might be the most valuable asset of all.

In summary

The 80,000-hour blind spot

When I saw that 82,000-hour calculation, what struck me wasn’t just the number. It was the realisation that most professionals haven’t accounted for it.

They’re still planning as if:

• They’ll work until 60-65
• They’ll retire for 15-20 years
• Healthcare costs will track general inflation
• Their current skillset will remain relevant

None of these assumptions hold anymore.

The uncomfortable truth: You’re likely going to work fewer years than you planned, live longer than you expected, and face healthcare costs that compound faster than your investments.

But here’s the opportunity: Very few people are adjusting their planning yet. Which means those who recalibrate now—who front-load savings, build skill resilience, over-insure on healthcare, and construct portfolios for 30+ year horizons—will have a meaningful advantage.

The question isn’t whether retirement math is changing. It’s whether you’re changing your plan to match it.

Because in an age where AI is compressing career timelines and longevity is extending life timelines, managing your money has never mattered more.

Disclaimer – Investment in the securities market is subject to market risks, read all the related documents carefully before investing. The information provided herein is intended solely for educational purposes and should not be construed as solicitation, advertising, or providing any financial or investment advice or an offer to buy or sell any financial instruments.All statements regarding future projections are purely illustrative in nature, subject to market conditions, and should not be construed as guarantees. Readers are advised to consult with their financial advisor before making investment decisions based on the information provided herein.

In the preparation of this document, Dezerv has used information developed in-house and publicly available information and other sources believed to be reliable. The information is not a complete disclosure of every material fact and terms and conditions. While reasonable care has been made to present reliable data in this article, Dezerv does not guarantee the accuracy or completeness of the data. The information / data herein alone is not sufficient and shouldn’t be used for the development or implementation of an investment strategy.

Any references to names of fund houses, investment securities, or asset classes are for illustrative purposes only. Dezerv, along with its directors, employees, or partners or any of its affiliates, shall not be held liable for any loss, damage, or liability arising from the use of this document. Additionally, all trademarks, logos, and brand names mentioned are the property of their respective owners and are used for identification purposes only. The use of these names, trademarks, and logos does not imply endorsement or recommendation.

Infosys was among the first to tap the U.S. capital markets. MakeMyTrip listed on Nasdaq in 2010. Freshworks followed in 2021, becoming the first Indian SaaS company to go public in the U.S. Even ReNew Power, a capital-heavy renewables business, chose to list in New York via a SPAC merger in 2021. For most tech founders, the path was familiar: build in India, raise abroad, scale globally, and eventually list overseas.

That path is now being re-evaluated. 

Over the past year, a growing number of India’s top startups—Razorpay, Zepto, Groww, Udaan, Pine Labs, and Meesho—have either initiated or completed the process of shifting their legal domiciles back to India.

PhonePe led the way in 2022, shelling out nearly ₹8,000 crore in taxes to make the move.  What seemed like an exception at the time now reads, in hindsight, as the harbinger of a broader shift.

Across boardrooms, there’s a new conversation: Should we come back? IPO-bound companies want domestic listings. SaaS companies that once treated India as a back office are now running core operations and product teams from here. Capital is now available locally, on better terms and with fewer strings.

This is not a compliance tweak. It is a deliberate repositioning. It reflects where the business is being built, where decisions are made, and where long-term value will be created.

In this edition, we explore:

1. Why startups went offshore
2. The roll call: startups making the move
3. The big flip: Why India looks better today
4. The IPO math- Why India now offers better outcomes
5. The challenges of homecoming 

Let’s dive in.

Why startups went offshore

Through most of the 2010s, setting up a holding company in Singapore or Delaware was practically a rite of passage for Indian startups. It made everything easier, especially when the early money came from global venture capital. The tilt towards offshore structures was reinforced by the power dynamics of the time—firms like Sequoia, Accel, Tiger Global, and Y Combinator had the capital, and with it, the leverage to shape how and where companies were built.

Foreign investors preferred familiar legal structures. U.S. funds, in particular, were far more comfortable wiring capital to a Delaware-registered company than to an Indian private limited entity. Incorporating abroad allowed startups to 

• Simplify ownership 
• Offer standard equity to global employees,
• Avoid the friction of India’s layered compliance frameworks.

There was also the long game. A foreign entity kept the door open for a Nasdaq listing, or a strategic acquisition by a U.S.-based tech major. For companies in SaaS, fintech, or cross-border commerce, that flexibility mattered.

The ecosystem looked outward, and structuring accordingly made sense. For most founders, it was less about leaving India behind and more about keeping their options wide open.

But the tides are now turning. 

The reverse-flip wave is well underway, and several marquee names have already completed the journey home:

• PhonePe set the precedent in 2022 by redomiciling from Singapore, absorbing a tax liability of nearly ₹8,000 crore in the process, to formally shift its headquarters back to India and reclaim its Indian identity.
• Groww followed in May 2024, paying ₹1,340 crore in taxes.
• Zepto executed its reverse merger from Singapore in January ahead of its proposed IPO
• Pine Labs received official approval in April to merge its Singapore parent with its Indian entity.
• Dream Sports (parent company of Dream11) completed its reverse flip through the government’s fast-track merger route, emerging as another high-profile returnee in recent months.
• Razorpay finalized its reverse flip in May 2025, consolidating the Delaware entity into its Bengaluru arm as it eyes an IPO by 2026–27.
• This week, Meesho completed its redomiciling to India, reportedly incurring a tax liability in the range of $280–300 million. The move positions the company for an upcoming domestic IPO.

Several other marquee names such as Flipkart, Eruditus, Livspace, and Mensa have publicly signaled plans to return, though exact timelines vary.

The big flip: Why India looks better today

India is now the world’s third-largest startup ecosystem, home to over 1,10,000 startups and more than 115 unicorns. 

But scale is only part of the story. What was once an ecosystem powered by global capital and geared for offshore listings is now looking inward. A surge in local funding, rising public market participation, and regulatory tailwinds are redrawing the map:

1. India’s IPO surge- India has leapt ahead in public markets and that’s changing the calculus for startups. In 2024, the country led the world in IPO volume with 327 listings, nearly double the 183 in the U.S, accounting for more than a quarter of all global IPOs. Retail and institutional investors are increasingly backing tech and consumer themes, giving strong domestic support to public offerings.

2. The rise of local capital-Indian capital is stepping up. Family offices are mushrooming, growing from around 45 in 2018 to nearly 300 in 2024, and now manage close to US $30 billion in assets—fuelled by IPO windfalls, promoter liquidity, and generational business wealth. Homegrown VCs are more active than ever, participating across stages. The abolition of the angel tax has further unlocked early-stage capital, removing a longstanding friction point for domestic investors. Equity rounds that once defaulted to offshore are increasingly being raised and closed within India and the narrative has followed suit.

3. Faster approvals for reverse flips- As this domestic appetite for listings has grown, the regulatory architecture has quietly adapted to support it. One of the biggest hurdles to shifting headquarters back to India used to be the paperwork. Startups had to go through the National Company Law Tribunal (NCLT), a slow legal process that often stretched for months. But recent changes led by the Department for Promotion of Industry and Internal Trade (DPIIT) and the Reserve Bank of India (RBI) have made it much easier. Companies can now complete the move with just RBI’s approval, bypassing the tribunal entirely and bringing down timelines to as little as 90 to 120 days. It is a quiet policy shift, but one that has made coming home far less painful.

4. SEBI’s startup-friendly reforms- SEBI eased several listing norms to accommodate modern startups. While the traditional requirement of three years of profitability still applies in most cases, loss-making companies can now list if a majority of the IPO is backed by institutional investors. This shift has allowed even loss-making startups to tap public markets, provided they meet stricter disclosure norms and secure backing from institutional investors. Recently, SEBI also allowed founders to retain ESOPs post-listing and permitted alternative investment funds (AIFs) to co-invest in public issues, making exits more viable and aligned with how high-growth tech companies operate.

5. Closer scrutiny of offshore structures- India’s regulatory lens on offshore incorporations has sharpened. Tax authorities are paying closer attention to companies routed through low-tax jurisdictions. New provisions like Significant Economic Presence (SEP) and expanded disclosure norms under Foreign Exchange Management Act (FEMA) have raised the bar on compliance. For many startups, especially those still operating largely out of India despite being incorporated abroad, these changes introduce legal complexity. 

6. Talent and ops: home is where the builders are- For many startups, India has always been the centre of execution. Product, engineering, and operations teams are overwhelmingly based here, even when the parent company sits offshore. That centre of gravity is only getting stronger with a wave of FAANG, consulting, and Y Combinator talent returning to build for India. The cost advantage remains real, but so does the maturity: India’s startup workforce now brings both velocity and depth, making it the natural base for scale.

The IPO math- Why India now offers better outcomes

India’s public markets are finally speaking the language of tech. From fintech and SaaS to consumer internet, there is growing investor appetite and analyst coverage for businesses that prioritise scale and network effects over early profits. That kind of depth, i.e, understanding high-growth, venture-backed models, simply did not exist five years ago.

As a result, Indian exchanges now offer a more realistic and founder-aligned path to liquidity. Many startups have listed with annual revenues under $100 million. Regulatory thresholds are lower, listing costs are lighter, and the investor base is increasingly receptive to growth-stage narratives.

Compare that to the US, where the bar remains high. A listing there demands significant scale, predictability, and investor readiness, often more than what a high-growth startup can offer early in its lifecycle

As Jordan Saxe, Senior Managing Director of Listings at NASDAQ, puts it:

“You have a high bar in the tech market. To IPO, companies need a high ARR (more than $300M–$400M) and a good Rule of 40. But more than that, you need to be able to predict the next 12 months of revenue.”

For a long time, U.S. exchanges were seen as the gold standard—bigger markets, higher multiples, deeper institutional capital. That model, however, is no longer the default. 

The result? Liquidity is now closer to home. Startups can go public earlier, raise meaningful capital, and continue scaling without waiting for a foreign listing window to open. For many founders, that changes not just the where but the when of going public.

The challenges of homecoming

• A strategic reset- Reversing a startup’s legal domicile is akin to a strategic reset. And like any shift in direction, it calls for clarity, alignment, and long-term thinking.

• Timing the move- Timing is key. Most companies initiate the flip around key inflection points- a planned IPO, a change in cap table, or a stage of scale where local presence is more valuable than overseas optionality.

• The tax hurdle- The most visible hurdle is taxation. Shifting the legal entity back to India can trigger significant capital gains and stamp duty liabilities on existing shareholdings, particularly when the offshore structure has accrued significant value. The numbers can be large, as seen in recent high-profile cases, but for most founders, they are seen as the price of alignment and not as a penalty.

• Execution- The reverse flipping process is smoother than before. Recent policy changes mean companies no longer need to go through the National Company Law Tribunal (NCLT). A single RBI clearance can now complete the transition, reducing timelines from 8–12 months to just 90–120 days. But execution still needs care. Aligning investor rights, ESOP structures, and governance norms with Indian regulations requires thoughtful planning and legal clarity.

• Cultural Shift- Flipping back invokes a broader signal to regulators, public investors, and the market at large. It reflects a willingness to be understood, evaluated, and trusted on Indian terms. That shift may take only a few months on paper, but culturally, it often runs deeper and takes longer.

Every startup story is a bet. Not just on what you are building, but where you choose to build it.

A decade ago, that bet tilted offshore. Legal structures followed capital. Founders optimised for access, optics, and optionality. But ecosystems evolve. Today, India is no longer the market you graduate from-it is the market you grow into.

From public markets to private capital, from regulatory support to talent density, the fundamentals have shifted. The tools to build enduring companies are concentrated right here.

For founders, the question is no longer why come back?

It is why not?

Disclaimer – The information provided herein is intended solely for educational purposes and is as on date of the document and is subject to change without notice. In this material, Dezerv has utilized information through publicly available sources, and other data deemed to be reliable. All trademarks, logos, and brand names mentioned are used for identification purposes only and do not imply endorsement or recommendation.

As Rapido stepped into the food delivery segment with a new platform that proposes charging restaurants a fixed fee per order, the competition to industry giants Swiggy and Eternal’s Zomato, is heating up.

Whilst this viral image compares how each of the platforms charge their customers, what struck me was the cost pressure on QSR companies in India.

India’s Quick Service Restaurant (QSR) sector—once the darling of post-COVID recovery stories and the poster child of our consumption boom—is facing a reality check that’s hard to digest.

From Domino’s to McDonald’s, Burger King to KFC, the numbers are telling a story — Same-store sales are falling, footfalls are dropping, and what was once considered “recession-proof” is now looking decidedly vulnerable.

But here’s what makes this particularly fascinating from an investment lens: we’re witnessing a fundamental shift in how India consumes.

The question isn’t whether QSRs will bounce back. With less than 1 store per million people compared to America’s 40+, the math on future growth is still compelling. The real question is simpler, yet more complex: In a market where everyone’s fighting for the same wallet, who’s actually building habits that stick beyond the honeymoon period?

In today’s edition of the Create Wealth newsletter, let’s uncover —

• The great QSR cooldown
• How to evaluate a QSR business: the four metrics that matter
• Cracking the unit economics of QSRs
• The QSR strategy reset
• Future roadmap 

What industry leaders are seeing: A market in transition

The QSR sector is experiencing a shift, and the insights from industry leaders paint a picture of adaptation and strategic recalibration rather than decline.

Across the board, India’s QSR players are witnessing the same trend: demand is slowing, volumes are softening, and discretionary spends are under pressure. The post-COVID boom that lifted food delivery, dine-in formats and store expansions has now clearly plateaued.

Let me show you a few excerpts from a few recent earnings calls of QSR companies. 

Rajeev Varman, who runs Restaurant Brands Asia (Burger King’s India operations), put it most directly. The QSR industry has been running negative same-store sales for two years straight. Stores that have been open for more than a year are actually selling less than they did the year before. In Varman’s words, just maintaining last year’s sales numbers has become “a very big challenge.”

Saurabh Kalra from Westlife Foodworld (McDonald’s India) offered perhaps the most telling insight: this slowdown isn’t limited to organized QSR chains. The local dhaba, the roadside chaat vendor, the neighborhood fast food joint—everyone’s feeling the pinch. When both premium burger chains and street food vendors are struggling simultaneously, it signals something deeper about how Indians are spending on food.

Sameer Khetarpal, CEO of Jubilant FoodWorks (Dominos), refrained from directly commenting on the demand slowdown, but his messaging reflected a cautious backdrop. He emphasised that recent growth was driven largely by internal initiatives. The underlying tone suggested that the company is navigating a subdued consumption environment, particularly in the mass and value segments.

The situation becomes even clearer when you look at Devyani International, which operates both KFC and Pizza Hut. Having two major brands under one roof gives them a unique vantage point, and their message is unambiguous: demand stress is real, and it’s persistent. Two consecutive years of declining same-store sales have forced them to slow down their expansion plans—a significant shift for an industry that’s been in growth mode for years.

Perhaps most telling is what’s happening with Swiggy and Zomato. These platforms revolutionised how Indians order food, making it as easy as tapping a phone screen. Even they are seeing quarter-on-quarter declines in their core business.

What emerges from these data points is the recalibration we are seeing in the QSR industry. 

The industry is moving from a phase of explosive growth to one of sustainable building. The companies that are being honest about these challenges—and adapting their strategies accordingly—are likely positioning themselves better for the next growth cycle.

The message is clear: the easy growth is over. Now comes the harder work of building businesses that can thrive in a more selective market.

How to evaluate a QSR business: the four metrics that matter

With demand under pressure, understanding how QSRs are really performing comes down to a few key metrics. These are the levers investors and operators track closely that define profitability, scalability, and long-term resilience.

1. Same-Store Sales Growth (SSSG)

This tells you if demand is getting stronger or weaker. It looks at how stores that have been open for more than a year are doing compared to last year—ignoring any boost from brand new locations.

2. Average Daily Sales (ADS)                                                                                                              

ADS tracks the daily revenue a store generates. When this number falls, it’s because either fewer people are coming in or customers are spending less per visit. Dropping daily sales often means the store is making less profit and is one of the first signs that a location is in trouble.

3. Store expansion and payback period

Fast food companies often grow by opening more stores, but what really matters is whether each new store makes financial sense. A healthy business should earn back what it spent to open a new store within a reasonable time frame.

If it takes too long to earn back that investment, it hurts cash flow and returns. When demand is weak, new stores take even longer to become profitable, making the decision of how fast to expand much trickier.                                                                             

4. Operating margins                                                                                                                    

This shows how well a company controls its costs compared to what it earns. Fast food businesses face fixed costs like rent, rising food prices, and fees to delivery apps—all of which squeeze profits. During slowdowns, this gets even harder: costs stay the same or go up while sales drop, crushing profitability. Brands with leaner operations and better pricing power stand out.

Cracking the unit economics of QSRs

At first glance, the QSR business looks deceptively simple – standardised menus, fast-moving inventory, and predictable footfalls. But under the hood, it is a margin-tight, volume-driven model where profitability hinges on scale, efficiency, and time. 

Several factors have made profitability elusive for QSR players in FY25. A few are: 

– High fixed costs and underutilised capacity:  Rent and staff expenses can account for 25 to 30% of store-level revenue. QSRs are built for volume, but when footfalls drop, that structure turns into a liability. Stores run below capacity, especially those designed for high throughput, and margins take a direct hit.

– Expansion plans: Store additions continued in FY25, but volumes lagged. This has led to higher depreciation and cost absorption without proportional revenue lift, as new stores take time to mature but start hitting the P&L from day one. In a subdued demand environment, this mismatch weighs heavily on profitability.

– Rising Input costs: Inflation in ingredients like cheese, flour, and edible oil continues to pinch. Without the headroom to raise prices meaningfully, gross margins remain under strain.

– Aggregator commissions: Post-COVID, delivery orders have taken up a larger share of the revenue mix, but at a cost. Brands with a high dependence on digital orders face a double squeeze: aggregator commissions of 18 to 25%, and the added burden of platform-driven discounts. While delivery boosts reach, it also dilutes margins more sharply than dine-in.

– Royalty and brand fees: Franchisees pay 3–8% of sales as royalty and marketing fees to global QSR parent companies. These fixed payouts put further pressure on weak demand cycles as they are paid on sales, not profits.

In FY25, these dynamics played out across the board. With SSSG declining and ADS under pressure, many brands saw profitability take a hit. The squeeze was compounded by continued expansion. Depreciation costs rose sharply, as capital expenditure rose, leading to an impact on profitability.

The top five listed QSR players by market capitalisation reported an average Return on Equity (ROE) of -2.8% and Return on Capital Employed (ROCE) of 5.7% in FY25. Among them, only Jubilant FoodWorks crossed the double-digit threshold on both metrics. Its performance stands out in an otherwise subdued sector, helped by a relatively mature brand, strong consumer recall, an established network, operational efficiencies, and deeper penetration across markets.

The QSR strategy reset

In a softer consumption environment, India’s QSR majors are shifting gears with a series of focused tactical plays. The goal is to protect volumes, preserve margins, and stay relevant in an increasingly value-conscious market.

Here is what the new playbook looks like: 

– Loyalty apps and digital promotions: App-only deals and reward programmes are driving repeat orders, nudging users toward direct channels and improving data capture.

– Value menus to protect frequency: To retain frequency, brands are rolling out ₹99 combos, bundled deals, and smaller, single-serve meals instead of relying on full-ticket orders.

– Low-capex formats: Express stores, kiosks, and smaller layouts are gaining traction. These formats lower setup costs while preserving market presence.

– Tech-enabled ordering and operations: AI-driven menus and app integrations are boosting throughput. Backend systems are also being tightened to reduce inefficiencies.

– Supply chain optimisation: Central kitchens and tighter inventory controls are being rolled out. Vendor contracts are also being renegotiated to improve unit economics.

– Measured global expansion: QSR brands are eyeing underpenetrated Southeast Asian markets as long-term plays. 

Despite the current slowdown, the long-term thesis for QSRs in India remains intact. The sector is still massively underpenetrated. 

The table below highlights this clearly. McDonald’s operates over 40 stores per million people in the US, but fewer than one per million in India. Even Domino’s, the most deeply penetrated player in the Indian market, has just 1.5 stores per million, compared to 21 per million in the US.

FY26 could bring a cyclical recovery with inflation well within control, base effects fading, and the possibility of tax cuts giving consumption a nudge. India’s Q4FY25 GDP growth of 7.4% surprised even the optimists, and if the momentum holds, it could translate into stronger discretionary spends.

But it is equally possible that we are entering a more selective consumption era, where only brands with pricing power, strong unit economics, and execution discipline will thrive. 

In summary 

The real test for QSRs isn’t whether someone tries your burger once. That’s easy. A well-placed ad, a coupon, or a craving can pull that off.

The real test is whether they come back for the third, fourth, and tenth time without a discount or a push notification.

When the novelty fades, does the habit stick?

That’s where brand gravity kicks in. Consistency, convenience, and recall take over.

India’s still a young, underpenetrated market where loyalties aren’t fixed, and habits are still up for grabs.

Which QSRs are building that habit today? And which ones are quietly losing it? That’s the question every investor should be asking right now.

Disclaimer – The information provided herein is intended solely for information purposes. In preparation of this material, Dezerv has utilized information developed inhouse and publicly available information, and other sources deemed to be reliable. All trademarks, logos, and brand names mentioned are the property of their respective owners and are used for identification purposes only. The use of these names, trademarks, and logos does not imply endorsement or recommendation.

In early 2008, when a few of us were working on starting up a wealth management business, I distinctly remember being excited about the new office we were to work from. The vibe that emanated from folks coming together for a common mission, energized each one of us individually, and eventually, the company. After nearly 13 years, we still tell stories of the times from hanging out in the office.

For a lot of folks, these stories, and how startup offices were different contributed in a big way to the excitement of working in a startup. These new offices were about spaces which facilitated casual conversations, creative ideation sessions, and in general “hanging out”.

So when we were thinking about our (first!) office, it was about this sense of bringing people together. We settled in on a great location, the heart of Mumbai’s CBD at BKC. It was designed to be open, bright, modern and yet to have a personal touch. Earlier this week, we finally got the photos of this place. And it was exactly as we had dreamt it to be.

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But in this new era of WFA, I wonder what this office space now means. Are we going to be a remote-first company, or are we going to mandate office attendance hoping to build a strong culture? And how does this office need to evolve to reflect that?

The office after all should reflect the values that we stand for:

1. Growth-oriented: We are a young and dynamic team that has hunger, shares the passion to grow, as a team and individually. By sharing our knowledge and experience within the team, we all come together with a common vision to build this into an idea that our users love.

2. Trust: Irrespective of where we work from, we trust each one of us wants to contribute. We do not need to supervise each other.

3. Relationships: We want to build meaningful bonds – not only with our friends and family but also with our co-workers and clients.

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When ideas come forth, innovation happens

The office space then should reflect these values. After all, the space informs our team’s culture, productivity and efficiency, and general well-being at work. Taken openness for instance. Offices without cubicles and cabins allow for better exchange of ideas. Most folks may not hesitate to share new ideas as much as they hesitate to knock on their manager’s door. So why have that door at all? Better communication means more collaboration and even greater innovation.

To encourage ideas to be shared, we need to encourage conversations. So we decided to find a way to do that, across teams. Multiple breakout areas, some well lit, some cozier, some casual, some formal. In fact, we are most excited about a lounge area where team members can hang out and unwind. Different spaces should set the context for different types of conversations.

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We believe that everyone can work from wherever they want, no questions asked. With this choice, comes the responsibility – on the organisation – to ensure we create the capabilities for remote collaboration. For us therefore, creating hybrid working environments was also important. Someone working from home should be able to reach out and connect with folks in the office seamlessly, and feel like they’re together.

And that’s how we will build this office. It will be our watering hole, where we come whenever we want to. It will also be equipped to with technology to engage with our colleagues who are working from elsewhere.

So for us, this office space remains as crucial as ever. A place that is always available, that will welcome us when we want to go there. A place we want to go to when we want human connection. A place which we belong to. A place where stories are made and friendships are built. A place that breathes the culture of trust, openness and warmth that dezerv. wants to be about.

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Author: Sandeep Jethwani (Co-founder — dezerv.)

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