Cashback card vs Reward points card 

Cashback vs reward points is a recurring question in the minds of newbie credit card holders.

Let me write my conclusion first and then I will explain my reasoning.

"Reward points are only really worth it if you are planning an international travel or a luxury resort stay inside India/or abroad"

For others cashback card is typically better. There are some exception to this with specific cards.*

If you check nearly all credit card reward points (RP) programs - the highest value of money typically equal or greater than INR 1/point is achieved only on flights and hotels.

The most common way to redeem RPs for high value is by transferring them on partner hotel chains or airlines. And then book dedicated rooms/seats (also called award seats) via their web-portal redeeming your points. The key idea is that one can redeem an expensive room or flight entirely on points earned on their credit cards.
For e.g. if you are able to book a stay worth 15000/night on 5000 RP one would say they redeemed their RPs on INR 3/point -> typically which is much higher than any other use of RPs such as pay with points or redeeming on credit card statement which is often less than 50paise/point.

What value you get for your points is unpredictable - and depends on what is the actual price point of hotel room or flight seat when you are booking. Some exception like Accor (a hotel partner) exists where each point is pegged to 0.02 euro. So calculation is easier and predictable. One of the reason Accor is such a favourite.

Once you start looking through the partner programs - you will notice that most hotel partners go on the luxury end - e.g. Marriott, ITC, Hilton, Hyatt etc. Accor is bit of an exception which allows you property on all ends of spectrum. However, good budget properties via Accor in India are very limited. Heck this year I was looking for Sri Lanka and Accor is non-existent there.

So if you are redeeming your points in India it will most likely be on luxe options via Marriott, ITC, Taj or luxury property via Accor such as Raffles.

Budget properties via Accor are more available in Europe, or our eastern neighbours such as Thailand, Vietnam etc.

For airlines partner - you will find typically find the low cost airlines such as Indigo missing from miles transfer. And even on international flights the best redemption value is on business class for long distances. This is because while actual or revenue fares scale proportional to distance between cities and depend on fuel consumption - point requirements don't linearly scale like that.
For e.g. on Singapore airlines business class ticket from Delhi to Singapore cost ~1,20,000 INR and Delhi to Ho Chi Minh cost ~1,60,000 INR on same date. But the point (or miles here) redemption value is same for both ~43000 miles.
The real catch is that you may never get the tickets on dates that you desire as award seats are very few in number. And points/miles have an expiry limit. So if you can't use them they go to waste.

As you can see the real multiplier of INR/RP happens when you redeem points on otherwise luxury options. But, they are typically available during international travels or lux hotels in India.

Another aspect to remember is that RP can't be used in any amount for hotel/airlines. You typically need to have a certain amount of points before they can be transferred to a partner and be used there. This means you need to have enough expenses to collect those many points in ~2 years. Because most RPs expire in 2-3 years.

So as you can see you need to have big enough expenses annually (at-least 7-8 Lakhs INR) outside of exempted categories such as rent, insurance, fuel or tax payments to collect sufficient RPs that they are worth anything and then have a plan and means to spend them on a good vacation abroad (which is where the real juice out of point comes). Will show calculations to this some other day.

IMO if you are unable to find enough meaningful spends outside of exempted categories worth >50K/month you are most likely be better off with a cashback card. As you can see once you exclude rent, utilities, insurance and taxes - spending 50K/month is not affordable for a lot of people. If you find yourself below this threshold - cashback cards are probably better.

*One notable exception is HDFC Smartbuy portal where you can redeem 1RP=1INR while doing flight/hotel bookings. Plus you can use as many points as you have 10 or 10000 - as you can club both points and cash. But you get standard revenue fares and not award fares in miles that we talked above. Also, you don't get 1RP=1INR for every card only premier ones. E.g. regalia gold offers 1RP=50paise still decent IMO.