SEBI Proposes Depository Receipts Framework For REIT And InvIT Units To Attract Foreign Capital

On 5 August, the Securities and Exchange Board of India (SEBI) proposed a framework to allow issuance of Depository Receipts (DRs) against units of Real Estate Investment Trusts (REITs) and publicly listed Infrastructure Investment Trusts (InvITs), based on the recommendations of its Hybrid Securities Advisory Committee.

SEBI said the Depository Receipts Scheme, 2014 permits issuance of DRs, which are foreign currency denominated instruments issued by a foreign depository against eligible securities. It noted that REIT and InvIT units are recognised as “securities” under the Securities Contracts (Regulation) Act, 1956 and are eligible for issuance of DRs under the Foreign Exchange Management (Non-Debt Instruments) Rules, 2019.

The regulator said REIT and InvIT units are listed on recognised stock exchanges in India and allowing DR issuance would provide foreign investors with an additional investment avenue. It added that the proposal would enable trading of these units in foreign currency on international exchanges and help attract foreign capital into REITs and InvITs.

However, SEBI noted that while the Depository Receipts Scheme and the NDI Rules permit issuance of DRs against REIT and InvIT units, the REIT Regulations and InvIT Regulations do not contain specific provisions enabling such issuance. It has therefore proposed amendments to expressly permit issuance of DRs against units of REITs and publicly offered InvITs, subject to the applicable regulatory framework.

Further, the regulator has also proposed issuing a detailed framework for DRs against REIT and publicly listed InvIT units through a circular, based on its existing Equity Depository Receipt Framework. It also proposed restricting DR issuance to REITs and publicly listed InvITs, stating that restrictions applicable to privately listed InvITs cannot be imposed on DRs issued and traded in permitted foreign jurisdictions.

SEBI has invited public comments on the proposal by 25 August 2026.