SEBI’s InvIT Push Gains Traction; Maharashtra, Rajasthan Explore InvIT Route As States Open Infrastructure Assets To Global Funds

India’s infrastructure monetisation push is slowly expanding beyond the Centre, with several states now exploring the InvIT route to unlock value from public assets.

Maharashtra is currently leading the process and is expected to introduce its InvIT-based asset monetisation policy within the next 4-5 months.

The move comes as the Securities and Exchange Board of India (SEBI) and the Bharat InvITs Association (BIA) continue working with state governments on regulatory structure, implementation models and asset monetisation frameworks.

Apart from Maharashtra, Rajasthan and Uttar Pradesh are also in discussions around InvIT-backed monetisation strategies.

Market participants said global pension funds and provident funds are showing strong interest in state-owned infrastructure assets, particularly projects with predictable cash flows and long operating histories.

The development also signals a broader shift from Centre-led monetisation towards a larger state-driven pipeline of infrastructure assets.

Why Is Maharashtra Emerging As The Front-Runner In State InvIT Monetisation?

Among all states currently evaluating the InvIT route, Maharashtra is seen as the most advanced. Discussions between the state government, SEBI and industry bodies have already moved into the framework and documentation stage. According to people aware of the process, work has started on model agreements and policy groundwork.

However, industry participants say the bigger challenge will be identifying assets that can attract institutional investors while also meeting pricing and audit scrutiny standards.

NS Venkatesh, Chief Executive Officer of the Bharat InvIT Association, said the policy structure itself is manageable, but the real difficulty lies in valuing public assets in a credible and transparent manner.

Unlike central agencies such as NHAI, most states do not yet have a tested framework for asset transfer and valuation under InvIT structures.

That has made pricing one of the most sensitive parts of the process.

Industry experts noted that aggressive pricing could later attract scrutiny from auditors and oversight agencies, which has historically slowed public asset monetisation decisions at the state level.

Which Sectors Could See The First Wave Of InvIT Monetisation?

Road infrastructure is expected to dominate the initial phase of state-level InvIT monetisation. Operational highways and expressways are seen as relatively easier assets to monetise because of their established traffic patterns and predictable cash flows.

Experts said states already have a reference model available through National Highways Authority of India (NHAI) InvIT structures. Other sectors, however, may take longer to scale because states will have to build investor confidence from the ground up.

Apart from roads, discussions are also taking place around:

• Renewable energy assets

• Power transmission infrastructure

• Warehousing projects

• Data centre-related infrastructure

Arka Majumdar, Partner at JSA Advocates & Solicitors, said SEBI has been actively encouraging states to consider monetisation opportunities in sectors such as power and data centres through InvIT structures.

The broader objective is to open long-duration public infrastructure assets to institutional capital while helping states generate fresh funding without outright asset sales.

Why Are Global Investors Interested In State InvIT Assets?

Market participants believe investor appetite is unlikely to be a major hurdle if states can offer credible assets with stable governance structures.

Global pension funds and provident funds are expected to be among the key investors because these institutions typically look for long-term yield-generating infrastructure assets.

According to industry experts, the larger concern is not availability of capital but confidence around valuation, governance and risk allocation.

Also Read - Pushp Masale Owner Set To Join IPO Market With Over ₹1,000 Crore Issue

If the first few state-led InvIT transactions are executed successfully, the sector could see significantly larger institutional participation over the coming years.

Source:

NDTV Profit