Affluent urban Indians eye 33% jump in mutual fund bets: UBS Poll 

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• Mutual fund inflows fell 14% in January 2026 to Rs 24,029 crore
• Wealthy households boost equity investments, steadying fund flows
• Gold demand to rise, affecting imports and current account

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Indian equity mutual fund net inflows contracted 14% month-on-month to Rs 24,029 crore in January 2026, as per the latest Association of Mutual Funds in India (AMFI) data, as large-cap redemptions and Rs30,917 crore in year-to-date foreign investor outflows through March 5 pressured sentiment. Even while household equity allocations hit 15 to 20% of total financial assets, on par with developed markets.

A new UBS Evidence Lab survey of 1,614 urban consumers spotlights a countervailing force from affluent households: Among those planning equity investments over the next 12 months, 33% in the top socio-economic class (SEC A, 44% of respondents with mean monthly incomes above Rs 60,000) favour mutual funds, while 24% target systematic investment plans (SIPs). Figures double those in SEC B (18% and 10%) and quadruple SEC C (9% and 3%).

Conducted between January 5 to 25 across 15 cities (84% in tier-1 and tier-2 areas, overall mean monthly household income Rs 45,000+), the poll signals this upper-middle cohort (28% of sample with incomes over Rs 50,000) as a stabilizer for fund flows, amid SEC A/B's 79% share of respondents.

Tanvee Gupta Jain, UBS Economist, noted, "Indian households have among the highest exposure to equities as a share of total financial assets across emerging markets. A factor that helps support premium valuations," even as year-to-date FII net outflows reached Rs 30,917 crore through March 5.

Gold hoarding ramps up as equity allocations deepen

Gold retains its saver status, with 54% expecting higher demand for bullion and silver in the next 12 months (25% steady), potentially steadying FY27 imports at 650 tonnes, largely investment-driven. UBS's global team forecasts annual average prices at $5,200 per ounce (upside to $5,750), which could widen the current account deficit to $37 billion, or 1.0% of GDP, in FY26 and push USD/INR to 92 by March end.

Equity preferences among planners skew affluent: Beyond mutual funds and SIPs, 18% of SEC A eye direct stocks versus 8% in SEC B and 2% in SEC C. With SEC A/B at 79% of the sample, this builds on households' 15-20% equity allocation to assets (now on par with developed markets) potentially offsetting January's Rs 2 lakh crore annual inflow pace, hampered by large-cap redemptions.

Jain emphasised, "Fiscal measures have disproportionately benefited the affluent, enabling deployment into investments alongside consumption." UBS's equity strategists eye Nifty at 26,500 by FY27 end, implying 7% upside from March 5 levels.

Macro pillars hold firm 

UBS's outlook sees nominal GDP expanding to $4.1 trillion in FY27 and $4.5 trillion in FY28, with per capita income at $2,858 and $3,084 respectively. Consumption grows 7.1% in FY27, matching capex at 7.0% and edging exports at 6.8%. Inflation averages 3.7% in FY27, fiscal deficit narrows to 7.4% of GDP, and FX reserves hit $695 billion.

Balance of payments shows a $47 billion current account gap (1.1% GDP) in FY27, buffered by $10 billion in projected FDI inflows. Credit ratings remain stable (S&P at BBB).

This setup echoes peers wherein Bank of America rates Indian autos overweight on rural recovery, while Goldman Sachs targets FMCG for 2026 volume gains.