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Sebi expects Reits’ AUM to surge, driven by reforms and transparency
Source: Business Standard
Illustration: Ajay Mohanty
The Securities and Exchange Board of India (Sebi) expects the assets under management (AUM) of real estate investment trusts (Reits) to surge manifold in the coming years, underpinned by regulatory reforms, transparency in valuations, and enhanced performance metrics, whole-time member Ashwani Bhatia said on Wednesday.
“REITs in India have seen remarkable growth. We have seen a vibrant industry unfold before our eyes. The total AUM of Reits currently stands at an impressive Rs 1.4 trillion, but there is potential for much more. Sebi has taken several measures to boost investor confidence, ease capital raising, and further refine the primary market framework to allow investors to be part of the decision-making process,” said Bhatia.
Bhatia was speaking at the launch of Data Benchmarking Institutions (DBIs) by the Indian Reits Association (IRA). These platforms—managed by financial firms CareEdge, CAMS, and KFintech—will provide investors with comparative analysis and information on the performance, valuation standards, and disclosures of Indian REITs.
The Sebi official said that the benchmarking will bring about accuracy, efficiency, and attract more customers into the Reits fold.
At present, there are four publicly listed REITs in India, with the first listing in 2019. The market regulator has also opened the doors for fractional ownership platforms in real estate to register as small and medium REITs.
“DBI will help investors understand the valuations of REIT assets, the impact of various assumptions, and the risks and rewards associated. This will bring a lot of transparency and help dispel any noise around Reits,” added Bhatia.
“Reits will lead to the financialisation of assets. It also takes risks away from the banking system and makes investments in the markets more transparent,” said Bhatia.
First Published: Sep 18 2024 | 8:54 PM IST
