Art as an Investment: Insights from the Indian Art Market’s Growth and Investment Potential

Data from the Indian market shows how phenomenally the market has grown over the past 20 years. While hitherto art was mostly considered a collectable and a luxury item, it has slowly and steadily moved into the category of capital asset, which by its very definition provides benefits over a long period of time.

There is no longer a debate on whether art is an asset class. The debate is on how to identify the works of art that truly have the potential to appreciate in value and on how to include art as part of a comprehensive wealth-building strategy. While not yet formally a part of the financial product suites of most banking institutions, there are a large number of private wealth management firms that are steadily integrating art into their wealth portfolio analysis.

An ‘investment’ can essentially be defined as an asset or item acquired with the goal of generating income or appreciation in value. 

In line with that, given below are a few examples that have emerged from the market in FY23 of works that have appreciated in value and earned good strong returns for their investors. We refer to them as repeat sales. A repeat sale is when an artwork is sold more than once at auction. It is the only indicator in the market that allows us to analyze the true investment potential of an artist/artwork. 

Tyeb Mehta (1925 – 2009) 

PURCHASED IN: DECEMBER 2014 PURCHASED FOR: RS. 17.5 CR

SOLD IN: APRIL 2022 SOLD FOR: RS 42 CR

HOLDING PERIOD: 7 YEARS AND 3 MONTHS CAGR: 12.6%

Born on July 26, 1925, Tyeb Mehta is essentially one of the most notable artists of India. He weathered the tumultuous times of India’s independence and the haunting spectre of Partition, events that deeply influenced his creative vision as a Muslim artist. Mehta’s oeuvre often reflected undercurrents of violence and his personal experiences, notably his vivid memories of the horrors of Partition. Traversing different periods, he shifted from textured expressionism to vibrant color fields and minimalist two-dimensional figures. The recurring motifs in his work, such as the trussed bull and the falling figure, conveyed profound meanings of restrained energy and dislocation. Through his art, Mehta revealed his innermost emotions and perspectives, offering viewers a glimpse into his personal narrative and the broader human condition.

Manjit Bawa (1941 – 2008)

PURCHASED IN: MAY 2016 PURCHASED FOR:  RS 49.5 L

SOLD IN: DECEMBER 2022 SOLD FOR: RS 96 L

HOLDING PERIOD: 6 YEARS AND 7 MONTHS CAGR: 10.6%

Manjit Bawa (Indian, 1941–2008) was a painter born in Dhuri, Punjab. Encouraged by his older brothers to pursue art, he attended the College of Art, New Delhi in 1958. He studied under Abani Sen, who was very influential on the artist’s distinct style and encouraged him to embrace figuratism during a time when abstraction was dominant. Bawa moved to Britain in 1964, where he continued his artistic practices, and worked as a silkscreen painter. Upon his return to India in 1971, he drew inspiration from Indian mythology and Sufi philosophy. Sticking to his customary palette of traditional Indian colours, such as red, pink, and violet, Bawa created unique and vibrantly coloured paintings, as well as sketches and drawings.

S.H. Raza (1922 – 2016)

PURCHASED IN: APRIL 2010 PURCHASED FOR:  RS. 1.2 CR

SOLD IN: JUNE 2022 SOLD FOR: RS 11.6 CR

HOLDING PERIOD: 12 YEARS AND 2 MONTHS CAGR: 20.4%

Raza worked mainly with a few primary colours, assembled and reassembled to simulate the passion and colours of his homeland. At the same time, he had realised the spiritual and metaphysical aspects of nature and began incorporating these principles in his works. In the late 1970s, the artist’s focus turned to pure geometrical forms; his images were improvisations on an essential theme: that of the mapping out of a metaphorical space in the mind. Around this time, the Bindu—a motif that would become synonymous with Raza’s art— began emerging in his work. It was the result of his concern with “pure plastic order” combined with his preoccupation with nature. “Both have converged into a single point and became inseparable; the point, the Bindu, symbolises the seed, bearing the potential of all life, in a sense. It is also a visible form containing all the essential requisites of line, tone, colour, texture and space. The black space is charged with latent forces aspiring for fulfilment.” The appearance of the Bindu as a single, meditative form marked Raza’s transition into pure geometric abstraction, the hallmark of his art in later years. In his long and illustrious career, Raza’s works have been a part of numerous exhibitions including the São Paulo Biennale in 1958; the Biennale de Menton in France in 1966; 1968 and in 1978; Contemporary Indian Painting at the Royal Academy, London in 1982; Roopankar Museum of Fine Arts, Bharat Bhavan, Bhopal; Jehangir Art Gallery, Mumbai; National Gallery of Modern Art, New Delhi in 1997; Celebrating 85 Years of Living Legend S H Raza, a travelling exhibition at Hong Kong, Singapore, Dubai, Mumbai, New Delhi organised by Aryan Art Gallery, and Raza – A Retrospective, Saffronart, New York in association with Berkeley Square Gallery in 2007; Paysage: Select Works 1950s-1970s, Sovereign FZE, Dubai in 2014; and Nirantar, Vadehra Art Gallery, New Delhi and Art Musings, Mumbai in 2016—to name a few. He was conferred the Padma Shri Award by the President of India in 1981 and the Padma Bhushan in 2007. 

Satish Gujral (1925 – 2020)

PURCHASED IN: JUNE 2017 PURCHASED FOR:  RS 30.4 L

SOLD IN: MAY 2022 SOLD FOR: RS 66 L

HOLDING PERIOD: 4 YEARS AND 11 MONTHS CAGR: 17.1%

Satish Gujral, an internationally acclaimed artist, muralist, sculptor, architect, and writer searched deeply for a unique Indian artistic identity, free of European influences. Through this mission, Gujral came to be known as one of the pioneers of modernism in India post-independence. The present lot, ‘Untitled’, painted in 2011 reflects his strong imprint of expressionist brushwork, a style he developed in Mexico, during an apprenticeship with revered Mexican muralists Diego Rivera and David Sequeiros.⁠

K Ramanujam (1941 – 1973)

PURCHASED IN: DECEMBER 2018 PURCHASED FOR:  RS 3.8 L

SOLD IN: APRIL 2022 SOLD FOR: RS 9.6 L

HOLDING PERIOD : 3 YEARS AND 3 MONTHS CAGR: 32.1%

K Ramanujan, who died young at the age of 33, on January 4, 1973, was a schizophrenic.  He typified the image of a troubled artist struggling with his own self-image. He was found unconscious and frothing at the mouth at the Cholamandal Art Village in Chennai.  This artist of tremendous potential was perhaps unable to reconcile himself to reality and committed suicide.  Despite the dark demons that must have been eating him up from the inside, Ramanujan in his short artistic career brought a lot of humour to his works.

The last decade has witnessed a strong and upward performance by the Indian art market. The last 3 years in particular have given the necessary impetus for the market to further grow and strengthen over the coming decade as well. Additionally, there is excitement in the market, coupled with an influx of capital from both generational and novice investors. Art as a lucrative investment is being actively pursued by some and curiously considered and explored by others.

Abhivyakti Shandilya

Contributor