Rakesh Rawal, the long-serving CEO of Anand Rathi Wealth, has been at the helm for 18 years and today oversees assets worth more than ₹87,000 crore as of June 2025. His leadership has helped position the firm among India’s most respected wealth managers, particularly known for its disciplined and strategy-led approach. In an exclusive interaction, Rawal spoke about how clients are changing the way they view investments, what strategies are proving successful, and the opportunities in a fast-evolving financial landscape.
The Focus on Risk-Adjusted Returns
Rawal revealed that most high-net-worth clients today are no longer chasing only high absolute returns but are placing greater importance on risk-adjusted outcomes. According to him, 74 percent of Anand Rathi’s clients surveyed expressed a preference for consistent, better risk-adjusted performance rather than chasing volatile short-term gains.
He explained that the firm typically builds portfolios aiming at 14 to 15 percent returns with a beta of 0.6 relative to the Nifty, which translates to a Jensen’s Alpha of around 4 to 5 percent. This is achieved through a blend of actively managed equity funds, structured products, and data-driven asset allocation guided by Nobel Prize-winning models such as the efficient frontier.
The Role of Actively Managed Mutual Funds
Rawal believes that the Nifty can deliver annualised returns of 11 to 12 percent in the long run, in line with India’s nominal GDP growth. However, he expects active fund managers to outperform by 3 to 4 percent, justifying their inclusion in client portfolios. Around 35 percent of portfolios are allocated to Nifty-linked structured products that provide benchmark-linked returns but with lower volatility. This approach helps clients achieve their target of 14 to 15 percent returns while keeping risk under control.
Changing Needs of Young Investors
Interestingly, younger affluent investors are also showing similar priorities. With inflation in India hovering above 7 percent, younger investors are aiming for returns in the range of 14 to 15 percent, effectively targeting growth that doubles inflation over time. Rawal observed that this generation is more focused on consistency and long-term wealth creation, preferring disciplined strategies over speculative bets.
The Growing Appetite Beyond Metros
Rawal also pointed to the rise of wealth management demand in Tier II and Tier III cities. While investors in these regions traditionally preferred real estate, they are now shifting towards financial assets. As of June 2025, 18 percent of mutual fund industry assets, amounting to ₹13.8 lakh crore, came from smaller towns. A significant 86 percent of this money was invested in equity schemes, highlighting a growing appetite for equities even outside metros.
Wealth Preservation and Legacy Building
For Rawal, wealth management is not just about growing money but also protecting and preserving it. He emphasised the importance of estate planning and legacy building, often through structures like Private Family Trusts. These tools help safeguard assets from liabilities while ensuring a smooth transfer of wealth across generations with minimal loss. Philanthropy and structured giving are also increasingly being integrated into wealth plans.
Technology as an Enabler
On the role of technology, Rawal stated that while digital tools and data analytics are invaluable in enhancing transparency and efficiency, they will never replace human advisory. At Anand Rathi Wealth, technology is being used to improve client reporting, detect gaps, and enhance documentation, while keeping data privacy at the core. He views technology as a sharpener of execution, strengthening long-term trust between advisors and clients.
Looking Ahead
The wealth management industry in India is poised for significant growth. Reports suggest the number of high-net-worth individuals is expected to double to 1.65 million by 2027, with around 20 percent of them under the age of 40. Rawal believes this shift will fuel demand for professional wealth managers who can offer not just products but comprehensive strategies.
For him, the ultimate goal is clear: consistent wealth creation with controlled risk, supported by sound planning, estate management, and a strong ethical compass.
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