(MENAFN– KNN India)
New Delhi, Jul 8 (KNN) Trading volumes of publicly traded Real Estate Investment Trusts (REITs) and Infrastructure Investment Trusts (InvITs) have experienced substantial growth over the past two years, driven by increased investor appetite for yield-generating assets, according to a report by ICRA Analysts.
The data reveals a remarkable surge in market activity, with public InvITs recording a 128.23 percent increase in trading volumes while public REITs witnessed an even more dramatic 399.54 percent surge since FY23.
The growth in traded value has been equally impressive, with public InvITs expanding by 115.53 percent over the two-year period and public REITs increasing by 177.78 percent since FY23.
These figures reflect growing market confidence in these investment instruments as viable alternatives for income-seeking investors.
The investor base for these instruments has also expanded, with the total number of unitholders in both REITs and InvITs combined growing by 8.23 percent in FY25, compared to 62.12 crore in FY24. Currently, five InvITs and four REITs are publicly traded in the market.
Market capitalisation figures further underscore the positive trajectory, with public REITs recording a 10 percent growth over 2023-24, while public InvITs witnessed a 4 percent increase in market capitalisation on a year-on-year basis.
Madhubani Sengupta, Head of Knowledge Services, ICRA Analytics, attributed the REIT growth to renewed institutional and retail investor appetite for commercial real estate-backed securities, supported by improved office demand and resilient rental yields.
Sengupta noted that the consistent uptick in InvIT performance points to ongoing confidence in the infrastructure financing ecosystem and growing recognition of InvITs as long-term yield instruments.
The government’s continued emphasis on infrastructure development and asset monetisation is expected to ensure a steady pipeline of assets for InvITs to expand their portfolios.
The analyst also highlighted the potential impact of Global Capability Centres (GCCs) on the commercial real estate sector, suggesting that their rising presence is likely to boost demand for premium Grade A office spaces, thereby providing opportunities for additional commercial real estate assets to be incorporated into REITs.
Looking ahead, ICRA Analysts anticipate increased IPO activity for REITs and a trend toward private entities transitioning to public market structures, citing strong market momentum and growing interest from both institutional and retail investors.
This development is viewed as indicative of increasing optimism and confidence in capital markets, as well as the growing maturity of the alternative investment space and its expanding appeal to both domestic and global investors.
(KNN Bureau)
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