Rising investor interest amid growing confidence in yield-generating assets is leading to a good growth in volumes of REITs and InvITs publicly traded in the last two years. The total volumes of public InvITs traded increased by 128.23 per cent in the last two years while that of public REITs surged by a whopping 399.54 per cent since FY2023, ICRA Analytics said.
REITs (Real Estate Investment Trusts) and InvITs (Infrastructure Investment Trusts) are investment vehicles that allow investors, both individual and institutional, to participate in the real estate and infrastructure sectors, respectively, without directly owning properties or infrastructure assets.
In terms of traded value, public InvITs grew by 115.53 per cent in the last two years while public REITs increased by 177.78 per cent since FY2023.
The volumes of public InvITs traded, which stood at 2735 lakh units in FY23, has increased to 6242 lakh units in FY25. On a year-on-year basis, volumes traded increased by 20.52 per cent from 5179 lakh units in FY24. The volumes of public REITs traded increased from a mere 3273 lakh units in FY23 to 16,350 lakh units in FY25. On a year-on-year basis, it grew by 230.10 per cent from 4953 lakh units in FY24.
The public InvITs’ traded value stood at Rs 6121 crore in FY25 as against Rs 2840 crore in FY23; while REITs was at Rs 31,206 crore in FY25 as compared with Rs 11,234 crore in FY23. On a year-on-year basis, InvITs’ traded value grew by 14.41 per cent from Rs 5350 crore in FY24 while that of REITs increased by 157.47 per cent from Rs 12,120 crore in FY24.
The total number of unitholders in both these instruments put together increased by 8.23 per cent at 67.23 crore in FY25, as against 62.12 crore in FY24. There are currently five InvITs and four REITs which are publicly traded.
“Market capitalisation of public REITs has grown by a healthy ~10 per cent over FY2024. This remarkable growth underscores renewed institutional and retail investor appetite for commercial real estate-backed securities, supported by uptick in office demand and resilient rental yields. Public InvITs have witnessed ~4 per cent rise in market capitalisation on a year-on-year basis. The consistent uptick points to ongoing confidence in the infrastructure financing ecosystem and growing recognition of InvITs as long-term yield instruments,” Madhubani Sengupta, Head- Knowledge Services, ICRA Analytics, said.
The year-on-year growth in traded volume, traded value, and market capitalisation for both REITs and InvITs highlights robust market participation and a favourable investment climate. These trends reflect the growing maturity of India’s alternative investment space and its increasing appeal to both domestic and global investors.
“As these asset classes evolve, closely tracking their performance will be critical for understanding broader market sentiment and identifying strategic investment opportunities. The government's focus on infrastructure development and asset monetisation plans will provide a steady pipeline of assets for InvITs to expand, while the growing number of GCCs is expected to drive the demand for good-quality Grade A office space, providing scope for commercial real estate to come under REITs. Amid strong market momentum and growing investor interest from both institutional and retail segments, there is expected to be a noticeable uptick in activity in the IPO space for REITs and a trend of private entities transitioning to public market structures, reflecting overall positive sentiment and confidence in capital markets." Sengupta added.
