InvITs can eaise extra debt to fund capex, repairs

ET BureauLast Updated: May 16, 2026, 10:07:00 AM IST

Synopsis

In a significant regulatory shift, India's Securities and Exchange Board of India (Sebi) has unveiled new guidelines for Infrastructure Investment Trusts, or InvITs. These entities are now permitted to exceed the 49% debt cap of their asset value, unlocking a new avenue for funding vital capital projects and enhancements.

The Securities and Exchange Board of India (Sebi) has allowed infrastructure investment trusts (InvITs) to use fresh borrowings that exceed 49% of the value of their assets for funding capital expenditure, major road maintenance and refinancing of debt. The move is aimed at providing flexibility to infrastructure asset owners. Sebi said InvITs can raise additional debt for capital expenditure aimed at enhancing asset performance or increasing capacity. Such borrowings can also be used for major maintenance expenditure related to road projects.

"Major maintenance expense shall mean expenditure incurred on maintenance of road projects which is not routine maintenance and is in accordance with the obligations and requirements specified in the concession agreement," Sebi said in a circular. In a separate circular, Sebi said SPVs held by InvITs would be allowed to retain their SPV status even after underlying concession agreement for an infra project ends or is terminated.

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