n a bid to facilitate ‘ease of investment’ for investors, regulator Sebi has allowed one more payment option of UPI to retail investors to apply in the public issue of REITs and InvITs for application value up to Rs 5 lakh.
Separately, the regulator has decided to reduce the time taken for allotment and listing of units of privately placed InvIT after the closure of the issue to six working days as against the present requirement of 30 working days.
The new framework, aimed at further streamlining the process, will be applicable to public issue of units of Infrastructure Investment Trust (InvIT) and real estate investment trust (REIT), which opens from August 1, the Securities and Exchange Board of India (Sebi) said in two separate circulars.
Sebi in January 2019 had laid down the process for payment for applications in the public issue of units of these new investment instruments through the facility of Applications Supported by Blocked Amount (ASBA).
The move is part of Sebi’s effort to streamline the process of allotment and listing of units.
REITs and InvITs are relatively new investment instruments in the Indian context but are extremely popular in the global markets.
While a REIT comprises a portfolio of commercial real assets, a major portion of which is already leased out, InvITs comprise a portfolio of infrastructure assets, such as highways and power transmission assets.
After consultation with stakeholders, it has been decided to provide an additional option to individual investors to apply in public issues of units of REITs and InvITs with a facility to block funds through UPI mechanism for application value up to Rs 5 lakh, Sebi said.
The regulator has asked all the entities involved in the process to coordinate with one another to ensure completion of the listing of securities and commencement of trading by T+ 6 (trading plus six) working days.
Further, the merchant banker needs to ensure that the process of additional payment mechanism through UPI is disclosed in the offer document and all the newspapers where the issue advertisement is disclosed.
The details of the investor — PAN and client ID — entered on the stock exchange platform at the time of bidding, will be validated by the stock exchange/s with the depositories on a real-time basis.
