SEBI Permits Real Estate and Infrastructure Trusts to Issue Depository Receipts Abroad

The Securities and Exchange Board of India (SEBI) introduced a structured mechanism allowing Real Estate Investment Trusts (REITs) and Infrastructure Investment Trusts (InvITs) to issue depository receipts to global investors. The new guidelines set out the procedural requirements, eligibility norms, and operational safeguards for domestic investment trusts aiming to tap international capital markets. Depository receipts are financial instruments issued by an overseas depository representing shares or units of a local issuer, allowing foreign entities to invest in domestic assets without directly trading on local exchanges.

Previously, investment trusts relied primarily on domestic pools and specific foreign portfolio routes, but this framework bridges international liquidity pools directly with Indian infrastructure and real estate assets. Trust managers and finance professionals must review SEBI's operational circulars to ensure adherence to disclosure standards, cross-border reporting norms, and investor eligibility checks. Keep track of subsequent SEBI notifications regarding procedural filings and depository agreements to guide client portfolios safely.

Bottom line: adherence to this new framework unlocks international funding channels for domestic infrastructure and real estate ventures.