After lending, Godrej Industries is now entering the wealth management business. Here's how it plans to scale it up

The name might be more synonymous with soaps or real estate, but Godrej Industries is scaling up its financial services play, five years after it started Godrej Capital, and sees it becoming the fastest-growing business.

Godrej Capital is primarily a lending business. Godrej Investments, the subsidiary of Godrej Industries, is now entering the fast-growing but already cluttered and competitive wealth management space.

Godrej Wealth will operate alongside Godrej Capital, together forming the financial services arm of the Godrej Industries Group. The target is to have Rs 1 lakh crore in assets under management (AUM) in the wealth business as well as Rs 1 lakh crore AUM in its lending business by 2031.

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How has Godrej’s financial services business grown?

The company had entered the space five years ago with Godrej Capital. It focuses on home loans, business loans, loans against property, professional loans etc. That business has grown to Rs 27,000 crore in AUM and should scale up to Rs 1 lakh crore in the next five years.

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Wealth Management Push

Godrej now sees massive opportunities in the wealth management space.

“India is going through a once-in-a-country's lifetime transition from a developing economy to hopefully a mid-income economy over the next decade or two, and beyond that, to a developed economy. I think, as you go through that transition, this is a period of huge wealth creation,” pointed Pirojsha Godrej, chairperson designate at Godrej Industries Group. 

With the kind of organisations getting built, and entrepreneurial activity happening across the country, Godrej felt the opportunity for a wealth creation platform was "tremendously strong."

“People need strong advice and the ability to invest capital productively. One of the things that will impact economic growth most strongly is the wisdom with which capital is deployed in the country. We hope to be able to play a part in that,” added Godrej. 

India has a growing affluent and HNI population. Godrej Wealth will primarily cater to clients with investable assets of Rs 2 crore and above, including entrepreneurs, new-age wealth creators, multi-generational business families, NRIs, and sophisticated investors with multi-asset needs.

The company will offer access to mutual funds, portfolio management services (PMS), alternative investment funds (AIF), private credit, and other portfolio solutions.

“I see this as potentially the fastest-growing business for the group over the next decade,” according to Godrej. 

It may also look at listing its financial services business in the next five years, according to Godrej. 

In the lending business, Godrej intends to scale up to 500 locations. In the wealth business, it will start with 7-8 locations, expanding to 35 locations over five years.