A new report from Grip Invest, titled ‘Gripping The Boom: Millennial Momentum in Bond Investing,’ reveals a significant shift in investment trends among millennials. According to the report, millennials now comprise 63% of all corporate bond investors on the platform. This change highlights how corporate bonds have transformed from a niche asset class into a mainstream investment choice.
Rise in Female Participation
One notable trend is the 54% increase in women choosing corporate bonds as their first investment option. This surge, observed from Q1 FY24 to Q2 FY24, reflects a broader demographic shift in investment behavior. Consequently, more women are engaging with this asset class.
Growth in Average Investments
Furthermore, the average investment in corporate bonds has increased by 1.8 times between 2023 and 2024. Grip Invest reported Rs 450 crore in corporate bond investments, showcasing a remarkable 200% growth in the past year. This impressive rise indicates strong confidence among investors.
Corporate Bonds Made Accessible
Moreover, the democratization of corporate bonds is a key theme in this report. Historically, these investments were limited to large institutions. Now, retail investors can easily access corporate bonds through platforms like Grip Invest. This change aligns with CRISIL’s prediction that India’s corporate bond market will double by 2030, potentially reaching Rs 100 trillion.
Nikhil Aggarwal, the founder and CEO of Grip Invest, noted, “Corporate bonds have transitioned from a niche asset to a mainstream investment. This shift results from millennials’ appetite for higher returns and a digital-first investment experience.”
Widespread Appeal Beyond Major Cities
Interestingly, corporate bond investments extend beyond major metropolitan areas. The top 10 cities account for only 43% of total investments. In fact, investments have come from over 3,000 pin codes. This widespread appeal stems from attractive combinations of returns, tenure, and ratings. Notably, 71% of the corporate bonds on Grip Invest’s platform are rated ‘A’ or higher, delivering returns of up to 12% with an 18-month tenure. Thus, investors across various regions recognize the potential of these bonds.
Impact of Regulatory Changes
Furthermore, regulatory reforms have significantly impacted the accessibility of corporate bonds. The reduction in the minimum investment requirement, from Rs 10 lakh to Rs 10,000, has broadened the investor base dramatically. As a result, more individuals can now participate in this market.
Aggarwal added, “As regulations continue to evolve, we are committed to helping more investors access corporate bonds. This offers a balanced approach to risk and reward.”
Conclusion
In conclusion, the rising popularity of corporate bonds—driven by increased accessibility and changing investor preferences—positions these investments as a key asset class in India’s growing financial landscape. Therefore, as more millennials and women enter the market, corporate bonds will likely continue to gain traction.
