What is an InvIT? Should you invest in it?

PowerGrid Infrastructure Investment Trust (PowerGrid InvIT) has come up with its IPO of Rs 7,735 crore (April 29-May 03, 2021). This is the third InvIT being listed and the first InvIT from a public-sector enterprise. What are infrastructure investment trusts? Abbreviated as InvITs, infrastructure investment trusts are regulated by SEBI. InvITs are primarily set up to facilitate direct investment from investors in infrastructure. The money that these trusts raise from investors is invested in income-generating infrastructure projects and investors are issued units in these trusts. Thereafter, InvITs are responsible for the projects' operations and maintenance. High capital expenditure is required for infrastructure projects

This article was originally published on April 30, 2021.