SEBI Depository Receipts are now an additional route for Real Estate Investment Trusts (REITs) and Infrastructure Investment Trusts (InvITs) to raise money from foreign investors. On 2 November 2026, the Securities and Exchange Board of India (SEBI) permitted these investment trusts to raise foreign capital through Depository Receipts (DRs). The regulator issued two circulars explaining the rules for issuing and listing these instruments.

The decision is expected to make it easier for overseas investors, including Non-Resident Indians (NRIs), to invest in India’s real estate and infrastructure sectors. It also gives REITs and InvITs another way to access international capital without requiring foreign investors to directly purchase their units on Indian domestic stock exchanges.

What Are Depository Receipts? SEBI Depository Receipts

Depository Receipts are financial instruments issued in a foreign market against securities held with a domestic custodian. They are generally denominated in foreign currencies and allow investors to gain exposure to securities from another country.

Under the new SEBI framework, REITs and InvITs can issue Depository Receipts against their units. These receipts will be listed on stock exchanges operating in the International Financial Services Centre (IFSC) at GIFT City, Gujarat.

The two exchanges identified for listing are India International Exchange (India INX) and NSE International Exchange. Both operate within GIFT City’s international financial services centre.

Through this arrangement, foreign investors can invest in Indian real estate and infrastructure trusts by purchasing Depository Receipts in the international market. This may help make Indian investment opportunities more accessible to overseas investors.

What Are REITs and InvITs?

Real Estate Investment Trusts and Infrastructure Investment Trusts are investment structures that allow people to invest in income-generating assets.

REITs collect money from investors and invest it in income-producing real estate properties, such as office buildings, shopping centres and commercial spaces. Investors receive returns through the income generated by these properties and other eligible distributions.

InvITs are designed to invest in infrastructure assets such as roads, power transmission networks and other infrastructure projects. They allow investors to participate in infrastructure-related income without directly owning or managing the assets.

Both investment structures help connect investors with large real estate and infrastructure projects. The new SEBI framework provides them with an additional option to attract foreign investment.

Rules for Issuing Depository Receipts

SEBI has introduced specific conditions to protect investors and maintain transparency in the new system.

A fresh issue of Depository Receipts must receive prior approval from the unitholders of the concerned REIT or InvIT. At least 75% of the votes cast must support the proposal.

However, if the trust issues additional Depository Receipts within an overall limit already approved by its unitholders, it will not need to seek approval again for every further offering.

The framework also covers situations where existing unitholders transfer their units for a Depository Receipt issue. In such cases, all unitholders must be given an opportunity to participate. This provision is intended to ensure fair treatment of investors.

Another important condition is that the holders of Depository Receipts and their beneficial owners must not be persons resident in India.

Restrictions on Issuers and Investors

SEBI has also introduced eligibility conditions for issuers and unitholders involved in the process. These rules aim to prevent entities with serious financial or regulatory violations from using the new route to raise funds.

Issuers and transferring unitholders must not be barred from accessing the capital markets. They must also not be classified as wilful defaulters or identified as fugitive economic offenders.

These safeguards are intended to support transparency and improve confidence among international investors. They also help ensure that the new fundraising route follows the country’s securities market regulations.

SEBI Reduces OFS Cooling-Off Period for Private InvITs

Along with SEBI Depository Receipt framework, SEBI announced another change related to Offer-for-Sale (OFS) transactions involving privately listed InvITs.

The regulator reduced the cooling-off period for illiquid units of privately listed InvITs from 12 weeks to eight weeks. The revised rule came into effect immediately after the announcement.

A cooling-off period is the required waiting time between certain transactions and an Offer-for-Sale. It helps prevent repeated trading activity around an OFS and supports orderly market operations.

The revised eight-week period applies to purchases and sales made both before and after an OFS transaction.

For comparison, the existing cooling-off periods for shares are two weeks for the most liquid shares and four weeks for liquid shares. The longer period for privately listed InvITs had created difficulties because these units generally have large trading lot sizes and limited market participation.

Why Did SEBI Change the OFS Rules?

SEBI recognised that privately listed InvIT units face liquidity challenges. Their high trading lot sizes can make it difficult for investors to buy and sell units frequently. Limited participation in the market can also reduce trading activity.

By reducing the cooling-off period from 12 weeks to eight weeks, SEBI aims to make the OFS process more flexible while maintaining safeguards for investors.

The change may help improve the ease of transactions involving privately listed InvIT units and address some of the practical difficulties faced by market participants.

GIFT City Gets a Bigger Role in International Finance

The new Depository Receipt framework also highlights the growing role of GIFT City in India’s international financial system. Located in Gujarat, GIFT City hosts the International Financial Services Centre, which provides a platform for international financial activities.

The listing of REIT and InvIT Depository Receipts on India INX and NSE International Exchange can help connect Indian investment trusts with overseas capital markets.

Together, these SEBI measures create another fundraising opportunity for REITs and InvITs and provide greater flexibility for transactions involving privately listed infrastructure investment trusts. They are also intended to strengthen India’s position as a destination for international investment.