1 min read.Updated: 30 Jun 2021, 10:33 AM ISTRenu Yadav
Following a board meeting, Sebi on Tuesday eased investment norms for Real Estate Investment Trusts or Reits and Infrastructure Investment Trusts or InvITs, allowing investors to make smaller bets
New Delhi: Embassy REIT on Wednesday said it will reduce the trading lot size of its units to 1 from 200, in line with Sebi's decision to reduce the minimum subscription amount and trading lot size for Reits and InvITs.
Following a board meeting, the Securities and Exchange Board of India (Sebi) on Tuesday eased investment norms for Real Estate Investment Trusts (Reits) and Infrastructure Investment Trusts (InvITs), allowing investors to make smaller bets. The minimum application value has been reduced from ₹50,000 to a range of ₹10,000-15,000. Investors can also buy and sell just one unit.
The timing and the effect of the reduction in lot size will be decided in due course, post appropriate coordination with the Indian stock exchanges, the company said in a release.
The reduction in lot size to 1 unit will bring REITs on a par with equities. This is expected to increase the retail participation in REITs. This will also help in improving the liquidity in the market.
Embassy REIT is the first real estate investment trust to be listed in India.
“We commend this proactive initiative by the regulator to reduce the trading lots of both REITs and InVITs. Embassy REIT’s listing in 2019, coupled with our strong and resilient performance over the 8 quarters since then, has paved the way for Indian REITs to evolve a mainstream asset class," said Michael Holland, chief executive officer of Embassy REIT said in a release.
With approximately $2 billion of primary REIT equity having listed in India in the last two years, leading global and domestic asset managers and growing numbers of retail holders now form the foundation of REIT unitholder registers, he said. "The reduction in lot size will increase liquidity for the entire REIT market, enable REITs to be included into benchmark domestic indices and allow greater participation from newer pools of institutional and retail investors," he added.