Power Grid Corporation of India (Power Grid) has announced the launch of an Rs 8000 crore InvIT IPO in March.
Infrastructure Investment Trusts (InvITs) and Real Estate Investment Trusts (REITs) in the country can raise Rs 8 lakh crore in the next 5 years. Global rating agency Crisil made this claim on Thursday in a report.
- January 28, 2021, 9:45 PM IST
Crisil said that the total assets under management (AUM) of InvITs and REITs in India will reach Rs 10 lakh crore in the next 5 years. That is, the value of the total financial assets of the infrastructure and real estate investment trust will increase to 10 lakh crore rupees. Crisil said in its report that after getting success abroad, now InvITs and REITs are also becoming popular in India.
This report by CRISIL comes at a time when the Power Grid Corporation of India (Power Grid), which distributes electricity, has announced the launch of an 8,000 crore rupee Invit IPO in March. Not only this, on 3 February, Brookfield India REIT owned by Canadian company Brookfield Asset Management is launching a REIT IPO worth Rs 3800 crore.
Investment of Rs 111 lakh crore required in infrastructure sector by 2025The central government estimates that by the year 2025, an investment of Rs 111 lakh crore will be required in the infrastructure sector. This is twice the amount spent on infrastructure development in the last 5 years. Because of this, other investment options are needed for financing infrastructure projects. Crisil said in its report that InvITs and REITs can prove to be very effective on this front.
Growth rate of both trusts 42 percent
The Global Ratings Agency said that the Compound Annual Growth Rate (CAGR) was recorded at 42% in both these types of trusts. This report states that since the launch of InvIT in India for the first time in 2018, the assets under management (AUM) of these trusts has reached Rs 2 lakh crore. At present, there are 11 InvITs and REITs in India.