New Delhi: Despite the common perception of India’s Gen-Z population as bold and risk-taking, a recent survey conducted by the Securities and Exchange Board of India (SEBI) in collaboration with market research firm Kantar indicates that young Indians are surprisingly cautious when it comes to equity investments.
The survey revealed that nearly 79% of Gen-Z households who invest demonstrate risk-averse behavior, prioritizing capital preservation over aggressive market exposure. Across the country, approximately 80% of all Indian investing households are focused on safeguarding their investments rather than pursuing higher equity returns, highlighting a strong preference for financial security.
Equity participation remains limited in India. Only 9.5% of Indian households, roughly 3.2 crore families, have invested or are currently invested in equity products. Of these, 60% are active investors, while the remainder are dormant. With India’s total households numbering 33.7 crore, the majority of families 90.5% remain outside the equity market. Among these non-investing households, 53.5% are aware of financial products but choose not to invest, whereas over 37% are completely unaware of equity market options, making them non-investors by default.
The survey also highlighted a low future intent to invest: only 22% of non-investors aware of equity products plan to invest in the future, indicating a substantial segment that is unlikely to enter the equity market in the near term.
Geographical analysis revealed disparities in equity market penetration. The highest penetration was observed in the top nine metropolitan cities at 23%, while overall urban centers recorded 15% penetration. Rural areas lagged significantly, with only 6% of households participating in equity investments. Among states and regions, Delhi led with 21% penetration, closely followed by the Andaman & Nicobar Islands at 17.1%, surpassing Maharashtra (17%) and Puducherry (16.4%). On the lower end, Nagaland recorded the lowest penetration at 3.4%, followed by Meghalaya (4.2%), Uttarakhand (4.5%), and both Uttar Pradesh and Tripura at 5.3%.
In terms of investment instruments, 6.7% of India’s population invests in mutual funds and exchange-traded funds, while direct stock market participation stands at 5.3%, further illustrating the cautious stance of Indian households toward market-linked products.
The SEBI-Kantar survey underscores a clear message: while India’s young population is often viewed as adventurous, when it comes to equity markets, risk aversion dominates, with capital protection taking precedence over high-return speculation. This conservative approach is expected to shape the evolution of India’s equity markets in the coming years.