Outlook Business
InvIT Or UnfIT Image Credit: Outlook Business
InvIT Or UnfIT Image Credit: Outlook Business

Invit Or Unfit?

The Onion-like Layers of an Invit Camouflage Its Overall Level of Indebtedness and Other Inherent Risks

Chaitanya Dalmia

A new financial instrument, which has been introduced in the Indian market after a long wait, is catching the fancy of the investor community. It is expected to dramatically change the complexion of the infrastructure landscape for the asset owners as well as bankers alike. Any change comes with much circumspection and therefore has to be marketed with much fanfare to make headway. So far, so good.


InvIT (Investment Trusts) are infrastructure assets bundled into units that can be subscribed to by investors just like the units of any mutual fund. The only difference is that underlying the former are hard assets while in the case of the latter, they are mostly shares of listed companies. It’s funny that in this case, nakal mein akal nahi lagi. The concept has presumably been ‘borrowed’ from REIT (Real Estate Investment Trust) where the underlying — rented-out properties — generate the return that unit holders get. In case of InvIT, if the “Inv” stands for investment, then what does the ‘I’ stand for? Perhaps the name should have been InfIT (Infrastructure Investment Trust).


Since it’s a new concept, I requested one of the lead managers to the issue to help me understand the product better since the prospectus is almost 900 pages and a hard-copy is impossible to get by these days (even with lead managers). I was thank

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