SEBI Proposes Overseas Depository Receipts for REITs and Listed InvITs to Attract Foreign Capital

The Securities and Exchange Board of India (SEBI) has proposed allowing Real Estate Investment Trusts (REITs) and publicly listed Infrastructure Investment Trusts (InvITs) to issue Depository Receipts (DRs) in overseas markets. The proposal could give Indian real estate and infrastructure trusts another route to attract foreign investors and capital. SEBI issued the consultation paper on 4 August 2026 and has invited public comments until 25 August.

Under the proposed framework, DRs would be issued against units of eligible REITs and publicly listed InvITs. These instruments would be available in permitted overseas jurisdictions, allowing foreign investors to trade them in foreign currency on approved international exchanges. The underlying units would remain with a custodian in India.

The move addresses a regulatory gap. REIT and InvIT units are already recognised as permissible securities under the Depository Receipts Scheme, 2014. Foreign investors can also invest in these units under the existing foreign exchange rules. However, SEBI’s REIT and InvIT regulations currently do not contain a specific provision that allows such trusts to issue DRs.

A Depository Receipt is a financial instrument that represents securities held in another country. Instead of buying an Indian-listed security directly, an overseas investor can buy a DR that represents the underlying security. This gives international investors a familiar way to access assets in another market while trading in a foreign currency.

For India’s infrastructure sector, the proposal could widen the investor base for publicly listed InvITs that hold assets such as highways, power transmission networks, renewable energy projects and other infrastructure. REITs, which hold income-generating commercial properties, could also gain greater access to international investors.

The proposal comes as India’s REIT and InvIT market continues to develop. Both structures allow investors to participate in real estate and infrastructure assets without directly purchasing or operating those assets. A wider overseas investor base could improve access to capital and increase the international visibility of Indian listed trusts.

However, SEBI has proposed excluding privately listed InvITs from the framework. The regulator has pointed to the restrictions that apply to these trusts, including a minimum trading lot of ₹25 lakh and limits on who can initially invest in them. SEBI has said these restrictions could be difficult to enforce if DRs were freely traded in overseas markets.

SEBI has proposed inserting enabling provisions into the REIT and InvIT regulations. The detailed operating framework would be issued separately through a SEBI circular. The regulator has indicated that the proposed system would broadly follow the existing framework used for Depository Receipts issued against listed Indian securities.

The proposal does not mean REITs and InvITs can immediately issue overseas DRs. It is currently under consultation, and the final framework will depend on SEBI’s review of stakeholder feedback.

If approved, the framework could give Indian infrastructure and commercial real estate trusts an additional channel to reach global investors. For infrastructure developers and asset owners, greater access to international capital could become another source of funding as India continues to expand roads, power networks, logistics assets, commercial property and other core infrastructure.