The Sebi capital market regulator is considering duplicating the investment limit of mutual funds in reit and 20 percent invitations for capital and hybrid schemes, while retaining the 10 percent limit for debt schemes
In a consultation document issued on Thursday, Sebi, the current single issuer, said that the general limits of 5 percent and 10 percent respectively in reit and invitations restrict MFS interested in taking exposure in these instruments as a limit of asshole torim to investigates in involvement/ debt instruments.
A higher investment limit in Reit and Invits would give MFS more investment routes and further diversify the MF schemes. The proposal is also expected to increase capital entry into these instruments, expanding its market and liquidity base.
Interested parties can send their views before May 11.
Sebi has been receiving representations of interested parties to classify the reit and guests as equity, and consider them as part of capital rates as in global markets.
AMFI and the MF Advisory Committee were of the opinion that the reit and guests should be classified as hybrid values instead of capital or debt values due to the difference in the structure related to their cash, dividends, net net rights limited to certain operational decisions.
In addition, it was deliberate by the MF Advisory Committee on whether the inclusion of these instruments as components of the equity indices would be appropriate and just with investors in schemes that follow the indices such as the reference points.
Sebi has sought the comments of investors on whether Reit and invitations, with characteristics of capital and debt instruments, can be classified as “equity” and their consequent inclusion rates for the purpose of investment by MFS.
Posted on April 17, 2025
