SEBI approves overseas fundraising route for REITs, InvITs through depository receipts

The latest market report highlights that The Securities and Exchange Board of India (SEBI) has approved a framework allowing real estate investment trusts (REITs) and publicly listed infrastructure investment trusts (InvITs) to mobilize capital from overseas market participants through depository receipts.

The move will provide REITs and InvITs with an additional route to access global pools of capital.

Under the framework, depository receipts can be issued against units of REITs and publicly listed InvITs. Fresh receipts can be issued against new units, while existing unitholders can additionally transfer units to foreign depositories for issuance of corresponding receipts, subject to the prescribed framework.

Indian residents and non-resident Indians will not be eligible to hold the depository receipts. SEBI has additionally approved other measures aimed at easing the regulatory framework for REITs and InvITs. These include allowing REITs and InvITs to invest minority stakes in under-construction projects owned by third parties, within prescribed exposure limits.mThe regulator has additionally provided for recognition of remote common infrastructure as real estate and changes to the cooling-off period for offers for sale.