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Monday, April 22 2024
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Nikhil Kamath on Bengaluru’s Paper Wealth and Real Estate

Survey Recommends Comprehensive Financial Governance for Mangaluru
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Nikhil Kamath, co-founder of Zerodha, recently shared insights on Bengaluru’s economic landscape and his views on real estate. Speaking about the city’s wealth dynamics, Kamath highlighted the prevalence of paper wealth, particularly among those employed in the tech sector. He emphasized that while Bengaluru may boast significant paper wealth, the actual expendable wealth remains relatively low. Kamath pointed out that much of this paper wealth stems from stock options and equity in tech companies, which may not translate into tangible financial assets.

Reflecting on his own journey, Kamath recalled his first job experience in Bengaluru, where he earned ₹8,000 working at a call center selling insurance. Despite feeling proud of his earnings at the time, he acknowledged the contrast when friends entered the workforce after college.

Additionally, Kamath expressed skepticism towards real estate investments in the current market. He criticized the high valuations, citing them as unreasonable given prevailing interest rates. Kamath revealed his preference for renting over buying property, noting that the rental yield outweighs the returns on capital deployed in real estate investments.

Kamath’s perspective sheds light on the complexities of wealth accumulation and investment decisions in Bengaluru’s evolving economic landscape.

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