Sebi Proposes Fast-Track Fundraising for REITs and InvITs

The Securities and Exchange Board of India (Sebi) has proposed a fast-track framework for follow-on offers by REITs and InvITs, alongside a three-year lock-in period for some units. Public comments are sought, with specific locking periods suggested for sponsors' units and requirements for stock exchange applications for fundraising.

The Securities and Exchange Board of India (Sebi) has presented a fresh framework aimed at expediting fund-raising efforts for real estate and infrastructure investment trusts—REITs and InvITs respectively. This initiative seeks to streamline the follow-on offer (FPO) process.

Central to the proposal is a lock-in clause mandating a three-year freeze on units allotted to sponsors, alongside varied lock-in durations for other unit allocations. This is designed to ensure stability and transparency in fundraising activities. The public has been invited to comment on these guidelines by March 13.

Additionally, Sebi has underscored the necessity for REITs and InvITs to secure in-principle approvals from stock exchanges, maintaining that a minimum public unitholding of 25 percent post-issue is essential. Merchant bankers play a crucial role in guiding these processes, reflecting Sebi's commitment to thorough regulatory oversight.