Riding the Infrastructure Wave: InvITs Set for Robust Growth in 2025 Part 3

Enhanced Regulatory Framework The Securities and Exchange Board of India (SEBI) has reduced the trading lot size for privately placed InvITs from ₹10 million to ₹2.5 million. This regulatory change is expected to increase liquidity and attract a broader range of investors to the InvIT market. Significant Capital Raising Activities In the fiscal year 2023–24, InvITs and Real Estate Investment Trusts (REITs) collectively raised ₹390.24 billion, marking a fivefold increase from the previous year. This surge reflects growing investor confidence and the government's push for infrastructure development. Increased Foreign Investment Foreign institutional investors have shown heightened interest in InvITs, contributing over ₹750 billion in investments. Notably, Brookfield-backed Data Infrastructure Trust raised nearly $1 billion through rupee bonds to fund the acquisition of American Tower Corp's Indian assets. Government's Infrastructure Spending Commitment The Indian government has maintained its record infrastructure spending target of ₹11.11 trillion ($132.85 billion) for the fiscal year 2024–25. This sustained investment underscores the government's commitment to infrastructure development, providing a favorable environment for InvIT growth. Controlled Leverage and Strong Credit Profiles Despite the rapid growth, InvITs are maintaining prudent financial practices. The average leverage of road InvITs is expected to remain below 49% by March 2026, ensuring strong credit profiles and investor confidence.