InvITs, REITs may raise Rs 8 lakh crore in 5 years

Mumbai: Infrastructure investments trusts and real estate investment trusts can raise Rs 8 lakh crore to take their total assets under management to Rs 10 lakh crore in the next five fiscal, rating agency Crisil said on Thursday. A deeper debt market where investors can discern risks and returns across infrastructure asset classes, and stable regulations will be critical to achieving this goal, it added.

It can be noted that Infrastructure investments trusts (InvITs) and real estate investment trusts (REITs) have been gaining popularity in India lately, after successes overseas.

The estimate from Crisil comes a day after reports of Power Grid filing for a USD 1.1 billion InvIT initial public offering. The government has estimated that investments of Rs 111 lakh crore are required to be done in infrastructure till 2025, which is double the amount spent in the last five years, requiring alternative channels of financing, it said.

InvITs and REITs can play a "significant role" on this front, the agency said, adding the assets under management (AUM) for these two avenues have logged a 42 per cent compound annual growth rate (CAGR) since the launch of the first InvIT in fiscal 2018 to Rs 2 lakh crore now.