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Sebi mulls regulatory framework for REITs, InvITs

New Delhi: Sebi on Thursday proposed to allow REITs and InvITs to issue depository receipts to provide foreign investors an opportunity to participate in the units of Indian emerging investment instruments. This will be beneficial for foreign investors as depository receipts (DR) avoids the need to trade directly with the Indian stock exchange, the Securities and Exchange Board of India (Sebi) said in a consultation paper. Real Estate Investment Trusts (REITs) and Infrastructure Investment Trusts (InvITs) are set up as Business Trusts and hold and operate revenue-generating real estate or infrastructure assets, respectively. REITs and InvITs raise funds by issuing units to the public at large.

REITs and InvITs do not have multiple schemes or classes of units. The units are denominated in Indian rupees and the units are also required to be listed on a recognised stock exchange in India. "Permitting issuance of Depository Receipts against units of REITs and InvITs which are listed on a foreign stock exchange gives foreign investors an opportunity to participate in the units of Indian REITs and InvITs," Sebi said.

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