Key Amendments to Securities and Exchange Board of India (Infrastructure Investment Trusts) Regulations, 2014
24 September 2025
The Securities and Exchange Board of India (Infrastructure Investment Trusts) Regulations, 2014, originally published on September 26, 2014, have undergone extensive amendments over the past decade to adapt to evolving market conditions and enhance the regulatory framework for infrastructure investment trusts (“InvITs”), reflecting the regulator’s response to market developments and operational experience. The recent Securities and Exchange Board of India (Infrastructure Investment Trust) (Third Amendment) Regulations, 2025, effective September 1, 2025, represents further progress in regulatory development. Key updates include refining the definition of “public” to exclude related parties, reducing minimum investment thresholds from Rs 1 crore to Rs 25 lakh, aligning reporting timelines with SEBI specified deadlines, and introducing enhanced valuation requirements for highly leveraged InvITs. By way of this amendment, SEBI continues responding swiftly to market reactions and the operational realities of the existing legal framework for InvITs.
Introduction:
The Securities and Exchange Board of India (“SEBI”) through a notification dated September 1, 2025, approved certain changes to the Securities and Exchange Board of India (Infrastructure Investment Trusts) Regulations, 2014 (the “InvIT Regulations”), and notified the Securities and Exchange Board of India (Infrastructure Investment Trust) (Third Amendment) Regulations, 2025 (the “Amendment Regulations”).
Some of the key highlights of the Amendment Regulations are:
Enhanced Accessibility
Reduction in minimum investment requirements: In terms of the Amendment Regulations, SEBI has reduced the minimum investment requirement from Rs 1 crore to Rs 25 lakh by any investor in a privately placed infrastructure investment trust (“InvIT”), making InvIT investments more accessible to a broader investor base. Additionally, requirement of minimum investment of Rs 25 crore in case the privately placed InvIT invests or proposes to invest not less than eighty per cent (80%) of the value of the InvIT assets in completed and revenue generating assets, has also been removed by way of the Amendment Regulations.
Operational Flexibility
Revision in timeline for InvIT quarterly reports to trustee and board of the investment manager, and the valuation reports: As perthe InvIT Regulations, quarterly reports on the activities of the InvIT had to be submitted by the investment manager to the trustee within thirty (30) days of the quarter end. In terms of the Amendment Regulations, timeline for submission of such quarterly reports shall be within such time as may be specified by the SEBI for submission of quarterly financial results, which is currently forty-five (45) days from the end of each quarter as per the master circular for InvITs. Similarly, a report on activity and performance of the InvIT shall now be placed by the investment manager before its board of directors at such time as may be specified by the SEBI for submission of quarterly financial results, which is currently forty-five (45) days from the end of each quarter as per the master circular for InvITs.
The valuation reports shall be submitted to the trustee simultaneously, at the time of submission of such reports to the stock exchanges under Regulation 21 of the InvIT Regulations, which is fifteen (15) days from the receipt of such reports. Additionally, Regulation 21(4) required conduct of full valuation at the end of the financial year. However, the Amendment Regulations clarify that such valuation report shall be submitted by the investment manager to the designated stock exchange(s), along with the annual financial results, which is currently sixty (60) days from the end of the financial year as per the master circular for InvITs. Further, in case of half yearly valuation reports, the Amendment Regulations clarify that such valuation report shall be submitted by the investment manager to the designated stock exchange(s), along with the quarterly financial results for the quarter ending September 30.
Negative cash flow adjustments: The InvIT Regulations required distribution of 100% of cash flows received by the holding company (“Holdco”) from underlying special purpose vehicles (“SPVs”), to the InvIT. However, the Amendment Regulations permit Holdco to offset negative net distributable cash flows with cash flows received from its SPVs when the Holdco’s own net distributable cash flows are negative, subject to appropriate disclosure requirements.
Risk-Based Monitoring
Quarterly valuation for InvITs with borrowings exceeding 49%: The Amendment Regulations have increased the level of oversight for highly leveraged structures by mandating a quarterly valuation of InvIT assets at each quarter end. This process is intended to reflect key changes, with the investment manager required to submit the valuation report to the designated stock exchanges, along with the quarterly financial results.
Quarterly report for InvITs with borrowings exceeding 49%: In furtherance to the amendment summarised in paragraph 3(i) above, the Amendment Regulations further clarified that the investment manager shall submit a quarterly report to the designated stock exchanges, along with the quarterly financial results.
Regulatory Clarity
Modification to the definition of “public”, with clear exclusions: In terms of the Amendment Regulations, the term “public” shall mean any person other than the related party of the InvIT, and now also related parties of its sponsor, investment manager or project manager or any person as specified by SEBI. It has been now further clarified that definition of the term “public” shall exclude sponsor, investment manager or project manager of the InvIT. However, a qualified institutional buyer in an offer shall continue to be considered public, even if it is a related party.
Simplified public offering provisions: The InvIT Regulations provided that any units offered to sponsor or investment manager or project manager or their related parties or their associates shall not be counted towards units offered to the public in terms of Regulation 14(1A). However, the said proviso has been omitted by way of the Amendment Regulations, in furtherance to the amendment summarised in paragraph 4(i) above.