Financial firms cash in on art boom

Madhumita Mookerji

Offer advisory services and portfolio management for art investors

KOLKATA: The canvas is significant though not particularly large at present. But, especially at a time when stock prices across the world are falling sharply, many strongly feel art is not just for art’s sake but a sound alternate investment option.
Several players — Edelweiss Securities, Bajaj Capital Art House (BCAH) and Art Vibes — are homing in on this potential by offering what is being regarded as art advisory services and portfolio management.

Edelweiss Securities, for instance, introduced an art fund through Yatra Funds and since January 2008, has tied up with Copal Arts to design portfolios in which art lovers and collectors can acquire quality works of artists.

Similarly, Bajaj Capital Art House, launched in August, offers art investment advisory, evaluation of art pieces, authentication certificates, fine art insurance, art restoration and art resale services.

Art Vibes has a strategy to provide portfolio management services for the private and corporate collector. “A wide variety of opportunities would include art collection advisory, valuation and appraisal, documentation and storage, auction representation, cataloguing, restoration and conservation, education and outreach programmes and sponsorships,” said Aashu Maheshwari, head of Art Vibes.

BCAH also provides services in branding requirement of visual artists through promotions, branding and representations etc.

Anurag Mehrotra, head of wealth management, Edelweiss Securities, said, “The Indian art market, though at a very nascent stage, finds connoisseurs worldwide and the numbers are increasing. The valuations are fairly low compared with international art pieces. In terms of market size, the Indian art market is only about 0.1% of the international market. So, the potential for growth is huge.”

In the mid-90s’ Indian art auctions were held in London and New York. Slowly but steadily, art is enlarging its canvas in India, with new galleries being set up in Bangalore and other cities. “Art was viewed as a status symbol. But post 2000, it has emerged as an investment option. Now, it is being considered as a separate asset class,” said Anu Bajaj, chief executive officer, BCAH.

The Indian art market is today valued at about Rs 1,500 crore growing at 30-35% annually. But what are the pitfalls? “The art market here is not regulated. Though Sebi and the government have taken some steps to improve efficiencies like introducing ban on collective investment schemes in art works, the market needs to mature like equity markets,” said Mehrotra.

“We don’t see any big risks yet but yes there are concerns like liquidity, transparency mechanisms, fake art works.”
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