Business Today

Gold brush

Govind Dhar | Print Edition: July 8, 2012

Art. To the uninitiated, the word conjures up images of lofty discussion and cerebral pursuit around a paint-strewn canvas; or a dense discourse of styles, eras, masters and concepts about the whys and wherefores of a sculpture or photograph and its meaning. Where does neoclassicism fit in with post-modernism? Is art a traditional painting or is it a mechanical dinosaur mounting a Jaguar car? Rife with abstraction and complexity, art has the ability to intimidate as well as allure. From impasto to pop art and post-modernism to sound experimentation, the art world's vocabulary beguiles and intrigues.

VIDEO:Tips for investing in art

So, if the idea behind the finished product can be so complex, where does that leave valuation? How does it come to be that a vast skull made of common Indian kitchenware can command millions of dollars and be displayed on the Grand Canal in Venice, and that a small canvas by a dead painter commands more in an auction room? And what about those on the periphery? What factors decide which new artists will hit the big time, and is there a formula to breaking records at auctions? Most of all, how do newcomers to art understand it? Or, indeed, invest and profit from it?

PODCAST:How to invest in art market

The gurus of the Indian art world suggest that learning about art and, therefore, appreciating it is not an exclusive, but time intensive process. "Learn about art on many different platforms, take time to see lots of exhibitions and get to know artists," says Peter Nagy, Director of Nature Morte art gallery. "Work with a trained gallerist or art advisor who has been working in the field for years." But does a self-administered education in art make it easier to invest? "I am not sure art is attractive to investors," says Amrita Jhaveri, a Mumbai-based collector and art advisor. "To be a good investor, one should be a collector first, and that is a different level of engagement. It is unrealistic to expect financial returns from art. The returns from art can be emotional and cannot be easily quantified."

Much like the debate on what constitutes art, opinions on investing in it differ. "The Indian art market has lagged behind global trends due to its unstructured format and also because of the lack of wealth in the country," says Amit Sarup, President of investment firm Religare's art and family office. "In the coming years the market is expected to multiply manifold. This will lead to an appreciation in prices." According to Art Tactic's May 2012 Confidence report, the Indian art market has been in decline in the past 20 months. Current sales volume is 62 per cent lower than in June 2010, so 'blue-chip' works of masters are available at cheaper rates.

Adds Ajay Seth, chief mentor of Copal Art: "In 2006, the 10 most expensive Indian artworks were priced at just 1.3 per cent of the 10 most expensive artworks globally. This has risen but is still under two per cent of global prices. Indian art is slowly gaining both in terms of price appreciation and global acknowledgement."

Art investment has become an alluring concept. Indian art became hot property in 1995. A decade on, prices for the works of masters such as M.F. Husain, S.H. Raza, F.N. Souza and the like soared, crossing the milliondollar mark several times. They now attract comparisons, not always fairly, with art valuations for the works of Pablo Picasso, Damien Hirst and even Chinese art masters. "Indian art has simply not made the great crossing into the normality of the international art world, in the way Chinese art has done," says Ranjit Hoskote, one of the country's most respected art theorists and curators. So, how does one go about investing in art?

Sotheby's clients
Sotheby's clients can watch all auctions live online, and place bids from anywhere in the world
First, let us distinguish between the market for the masters and the one for popular contemporary artists. The works of a few masters - such as Raza, Husain, Souza, Tyeb Mehta, V.S. Gaitonde and Amrita Shergill - feature in top auctions and sell for crores. According to Art Tactic, contemporary artists such as Jitish Kalat, Bharti Kher, Subodh Gupta, Alwar Balasubramaniam and Atul Dodiya, among others, are likely to have price and value longevity beyond 10 years.

Popular contemporaries and upcoming artists use a variety of new techniques, materials and media to create works that you can hang on a wall as well as experience in the form of sound or video installations and sculpture. However, in India, paintings and sculptures command the highest prices.

The art market in India is estimated at anywhere between Rs 1,000 and Rs 2,000 crore. "If one invests in the established artists, downsides over a long-term period are limited and a decent return can be expected," says Sarup. "Similarly if one invests in new artists, then the risk will be relatively much higher, though gains expected will also be much higher on an absolute basis."

SPECIAL:What drives youngsters to invest in art

For investors with Rs 50 lakh and above to invest in art, a basic portfolio of works of some of the popular contemporaries can be put together. However, for those looking to invest in emerging artists, a healthy art movement is bubbling across the nation with experimentation across a variety of styles and media, providing better options to those with Rs 10-15 lakh to spare. In fact, at a time when masters' works are not fetching what they should globally, picking up art works for relatively less and selling them quickly could be an option. Seth says: "One of our clients had purchased an 8x6-inch untitled work by Raza - acrylic on canvas - for Rs 5 lakh. It sold for Rs 6 lakh in less than a week. Another client bought a sculpture by Raza for $20,000, which sold for $30,000 within a week."

Looking out for the 'next big thing' is the big attraction in art investment today. But art pundits discourage speculation of this sort, and not just because their outlook on art in India is bleak. "India's art pedagogy is weak, and will consistently turn out artists whose basic understanding of art-making is shaped by a gallery ethos," says Hoskote. "Artists are unwilling to take major creative risks and are held captive by the temptation of high finish, wellbehaved objects, and manuals of achievement." But Hoskote is hopeful, as people from outside conventional art-making territory - design, activism, cyber culture, photojournalism, blogging, architecture - are making the best works.

So, where do we look for new talent? "The first place to look is at the programmes of younger galleries - less than 10 years old - in the city that these artists live in," says Jhaveri, the Mumbai collector. Others advise following the art scene closely by ascertaining who the tastemakers are, such as gallerists, art promoters, curators and art theorists, and getting an idea of what they feel is growing the ambit of art expression in India. In this space, some established art galleries such as Vadehra (Delhi), Nature Morte (Delhi), Chemould Prescott Road (Mumbai), Pundole (Mumbai), Apparao Galleries (Chennai), Galerie88 (Kolkata) and Gallery Espace (Delhi) are a good starting point. For more experimental or newer artists, Devi Art Foundation, KHOJ, Gallery Skye, Experimenter, Mirchandani & Steinruecke, and Seven Art Limited are the galleries to follow.

In terms of whom and what type of artist to look out for, the list is ever-growing. For example, photographic art is beginning to create records globally but has yet to have the same cachet in India. Still, artists such as Gauri Gill, Ryan Lobo, Yamini Nayar and Remen Chopra have established themselves with the medium. From Chopra's exploration of layered aesthetics and Gill's captured commentary on everyday life and people, to Nayar's explorations of architectural space and memory and Lobo's captivating sceneries, these photography artists pave the way for the camera at home and abroad. Then, of course, there is film and sound art of which Navin Thomas and Rashmi Munikempanna are upcoming exponents. These two demonstrate works that do not always have an obvious narrative but delve into abstract ideas and frameworks.

Artist Subodh Gupta
Artist Subodh Gupta takes everyday items and creates monumental art installations
Taking abstraction to new heights with a variety of works using traditional methods of paint and canvas as well as film, video, sound, drawing and sculpture, The Desire Machine Collective (Sonal Jain and Mriganka Madhukaillya), Praneet Soi, Manish Nai, Asim Waqif, Rohini Devasher, Aakash Nihalani, Seher Shah and Sumakshi Singh have exhibited works in India and abroad.

On closer inspection of these works, categorisation becomes impossible, signalling the changing face of the practice. Best of all, works by these artists can be picked up from anywhere between Rs 50,000 and a few lakhs, with a few works just about crossing the Rs 10-lakh mark.

While certainly not exhaustive, this list demonstrates the wide variety of abilities, exposure, conceptual exploration and expression in art that is perhaps not on every collector's radar in India. However, the work on display and the number of galleries and art organisations at home and abroad that are taking note of India's contemporary artists could spell the coming of another Subodh Gupta or T.V. Santhosh at a time when experimental or non-established artists' works are relatively cheap. But many would do well to Nature Morte's Nagy: "You don't go to a shoemaker to get your teeth fixed. Likewise, contemporary art is a highly specialised field and you should get the advice of professionals."

For those who do not have time to research, art advisors such as Copal Art, Crayon Capital, Sotheby's auction house, Art Ventures & Management, and Religare offer advice on how to go about collecting and selling art for a profit. They also educate you on the art world, masters, contemporary and modern movements via prescribed talks, fora and discussions.

Saffronart, an Indian online auction house, is even experimenting with capsule auctions where no reserve prices are set for works. Theoretically, works high in value can be bought for a fraction of their market price. All in all, in-depth knowledge of the market and its players, their concepts and media, and their progress is the mantra for knowledgeably investing in art.

Of course, the best investors are art lovers first. After that, profit becomes relative.

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