Sebi to include REITs in indices to boost liquidity, widen InvITs reach
Sebi to include REITs in indices to boost liquidity, widen InvITs reach
Sebi signals a policy push to include REITs in indices and broaden InvITs, aiming to lift liquidity and participation in India's growing asset classes.
New Delhi — The Securities and Exchange Board of India (Sebi) is nudging toward a more liquid and accessible market for real estate investment trusts (REITs) and infrastructure investment trusts (InvITs). Speaking at the National Conclave on REITs & InvITs, Sebi chairman Tuhin Kanta Pandey said the regulator is examining the inclusion of REITs in market indices through an appropriate glide path. The move could make these instruments more attractive to a wider set of investors by improving liquidity and visibility.
Pandey also outlined a plan to expand the pool of liquid mutual fund schemes that can invest in REITs and InvITs, while continuing to safeguard investor interests. He added that private InvITs might even fund greenfield projects if suitable safeguards are in place, signaling a broader role for InvITs in supporting new infrastructure ventures.
The regulator is actively engaging institutional investors to deepen their participation and is coordinating with the finance ministry and several state governments to accelerate public-asset monetisation. There is also ongoing collaboration with the Insurance Regulatory and Development Authority of India (Irdai), the Pension Fund Regulatory and Development Authority (PFRDA), and the Employees' Provident Fund Organisation (EPFO) to facilitate greater participation from their entities under their purview.
Pandey stressed that while the potential for REITs and InvITs is immense, the market remains nascent. Sebi intends to roll out the necessary frameworks and guardrails after stakeholder consultations, with industry sponsors, managers, advisors, and intermediaries urged to believe in the asset class’s potential and contribute to depth and liquidity. He concluded that a coordinated effort across regulators and government bodies will be crucial to making these instruments a more mainstream option for investors.
Cover image source: Sebi signals major policy shift with index inclusion, liquidity push for REITs, InvITs 🔗
