Combined AUM of Indian InvITs and REITs Projected to Reach Rs 20 Trillion by FY31

The combined assets under management of Indian infrastructure investment trusts and real estate investment trusts are projected to double to approximately Rs 20 trillion by the 2030-31 fiscal year, growing from an estimated Rs 10 trillion in 2025-26. According to a release published by rating agency ICRA, the expansion represents a compound annual growth rate of roughly 15% over the five-year horizon, supported by continued asset monetisation and shifting regulatory frameworks.

The anticipated growth trajectory follows substantial expansion over the preceding five years, during which combined assets under management rose from about Rs 4 trillion in 2020-21 to Rs 10 trillion by 2025-26. Rating executives noted that the domestic ecosystem has achieved sufficient scale and market acceptance to sustain capital deployment across both established infrastructure corridors and emerging asset classes.

ICRA projects that infrastructure investment trust assets will climb to approximately Rs 13.5 trillion by 2030-31, while real estate investment trusts are expected to expand to around Rs 6.5 trillion. This medium-term momentum will be anchored by ongoing monetisation of operational road and transmission assets, alongside the broader rollout of renewable energy generation facilities and optical fibre networks.

Simultaneously, commercial real estate portfolios are deepening their market penetration, while warehousing facilities and data centres emerge as prominent growth vectors. By the close of the 2025-26 fiscal year, the formal landscape encompassed 25 distinct infrastructure investment trusts and six publicly listed real estate investment trusts.

Within the infrastructure trust segment, road assets advanced rapidly to capture a 43% share of total assets by March 2026, up significantly from 16% in March 2021. Telecom infrastructure maintained a narrow lead, accounting for 44% of the segment total. Meanwhile, commercial office properties remained the primary anchor for real estate trusts, supplemented by gradual diversification into retail and warehousing properties.

Historical metrics underscore the momentum achieved across the past half-decade. Infrastructure trust assets advanced from Rs 3.2 trillion in March 2021 to roughly Rs 7.0 trillion by March 2026, registering a compound annual growth rate of 17%. Real estate trusts exhibited faster relative expansion, surging from approximately Rs 700 billion to Rs 3.1 trillion over the same period, translating to a compound annual growth rate of 33%.

A decade of phased regulatory adjustments has broadened market depth and improved funding flexibility for issuers. Key structural updates include the formal reclassification of real estate trusts as equity for mutual fund investment mandates in January 2026, alongside scheduled provisions permitting scheduled commercial banks to extend direct lending at the trust level beginning October 1, 2026.

broadening the statutory definition of strategic investors to encompass all qualified institutional buyers has enlarged the domestic capital pool. Mutual fund exposure expanded 56% year-on-year to exceed Rs 310 billion by June 2026, complemented by deepening allocations from insurance companies, pension funds, sovereign wealth entities, and retail participants.

Seasoned market issuances have delivered a median extended internal rate of return of approximately 14%, bolstering investor confidence alongside a noticeable compression in borrowing spreads relative to sovereign G-Secs and top-tier corporate debt. Cumulative capital mobilization across public offerings, private placements, preferential allotments, and rights issues reached roughly Rs 200 billion since the 2019-20 fiscal year, with infrastructure trusts accounting for nearly 80% of total funds raised.

Despite a favorable outlook, rating analysts cautioned that sustained credit profiles will depend on disciplined debt structuring, adequate liquidity cushions, and prudent asset acquisitions. Key operational monitorables include managing refinancing risks, addressing restrictive covenants within special purpose vehicles, and navigating potential valuation fluctuations or tax policy modifications.