InvITs & REITs Fundraising Skyrockets in FY24
ECONOMY & POLICY

InvITs & REITs Fundraising Skyrockets in FY24

In the dynamic landscape of India's real estate and infrastructure sectors, Infrastructure Investment Trusts (InvITs) and Real Estate Investment Trusts (REITs) have emerged as compelling investment avenues. The fiscal year 2023-24 witnessed an unprecedented surge in fundraising through InvITs and REITs, reaching a staggering Rs. 17,116 crore. This meteoric rise underscores the growing confidence of investors in these investment vehicles, driven by promising returns and a conducive regulatory environment.

InvITs and REITs are innovative financial instruments that enable retail and institutional investors to participate in the infrastructure and real estate sectors, respectively, without directly owning the underlying assets. They pool funds from multiple investors to invest in income-generating assets, such as toll roads, power transmission lines, commercial real estate, and more. This diversification of assets mitigates risk while offering attractive yields, making InvITs and REITs an attractive proposition for both conservative and yield-seeking investors.

The exponential growth in fundraising reflects the robust performance of existing InvITs and REITs, which have consistently delivered steady returns amidst market volatility. Moreover, the favourable tax treatment accorded to these investment vehicles enhances their attractiveness, particularly for high-net-worth individuals and institutional investors.

A key driver behind this surge in fundraising is the growing demand for infrastructure development in India. With the government's renewed focus on infrastructure projects across sectors such as transportation, energy, and telecommunications, there is a pressing need for long-term capital investment. InvITs have emerged as a preferred financing option for infrastructure developers, providing them with access to a diversified investor base and long-term capital at competitive rates.

Similarly, the commercial real estate market in India is witnessing a revival, driven by robust demand for office spaces and retail outlets. REITs offer investors an opportunity to gain exposure to this burgeoning sector while enjoying stable rental income and potential capital appreciation.

In conclusion, the exponential increase in fundraising through InvITs and REITs in FY24 underscores their growing significance in India's investment landscape. With their ability to generate steady income streams and provide diversification benefits, InvITs and REITs are poised to play a pivotal role in driving capital formation and fuelling economic growth in the years to come.

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In the dynamic landscape of India's real estate and infrastructure sectors, Infrastructure Investment Trusts (InvITs) and Real Estate Investment Trusts (REITs) have emerged as compelling investment avenues. The fiscal year 2023-24 witnessed an unprecedented surge in fundraising through InvITs and REITs, reaching a staggering Rs. 17,116 crore. This meteoric rise underscores the growing confidence of investors in these investment vehicles, driven by promising returns and a conducive regulatory environment. InvITs and REITs are innovative financial instruments that enable retail and institutional investors to participate in the infrastructure and real estate sectors, respectively, without directly owning the underlying assets. They pool funds from multiple investors to invest in income-generating assets, such as toll roads, power transmission lines, commercial real estate, and more. This diversification of assets mitigates risk while offering attractive yields, making InvITs and REITs an attractive proposition for both conservative and yield-seeking investors. The exponential growth in fundraising reflects the robust performance of existing InvITs and REITs, which have consistently delivered steady returns amidst market volatility. Moreover, the favourable tax treatment accorded to these investment vehicles enhances their attractiveness, particularly for high-net-worth individuals and institutional investors. A key driver behind this surge in fundraising is the growing demand for infrastructure development in India. With the government's renewed focus on infrastructure projects across sectors such as transportation, energy, and telecommunications, there is a pressing need for long-term capital investment. InvITs have emerged as a preferred financing option for infrastructure developers, providing them with access to a diversified investor base and long-term capital at competitive rates. Similarly, the commercial real estate market in India is witnessing a revival, driven by robust demand for office spaces and retail outlets. REITs offer investors an opportunity to gain exposure to this burgeoning sector while enjoying stable rental income and potential capital appreciation. In conclusion, the exponential increase in fundraising through InvITs and REITs in FY24 underscores their growing significance in India's investment landscape. With their ability to generate steady income streams and provide diversification benefits, InvITs and REITs are poised to play a pivotal role in driving capital formation and fuelling economic growth in the years to come.

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