On 2 November 2026, SEBI issued a circular that lets Indian real estate investment trusts, or REITs, offer depository receipts to investors outside India. The receipts are priced in a foreign currency and list on the two stock exchanges in GIFT IFSC, India's international financial services centre. For an advisor with non-resident clients, the first question is easy to ask and harder to answer. Is this a new investment, or a new wrapper around an old one?
It is a wrapper, and that shapes everything an advisor should tell a client. The receipts give NRIs and other foreign investors a way to hold Indian REIT units in a foreign currency, on an exchange outside the domestic market. They do not change the rupee properties underneath, the rent those properties earn or the risks attached to them. Our guide to GIFT City mutual funds and other global routes explains where GIFT City sits among the routes clients already use. This article sets out what the new receipts are, who may hold them and what advisors should check before a client buys one.
What depository receipts are and how the REIT version works
A depository receipt is a negotiable security that represents securities issued in another market, according to the Arthapedia reference of the Indian Economic Service. The familiar examples are American depository receipts, issued in the US against shares of companies elsewhere, and global depository receipts, the collective term for receipts issued outside the US. The mechanics are similar in each case. The underlying securities sit with a custodian in the home market, and a foreign depository issues receipts against them.
SEBI's framework for depository receipts on units of REITs applies this model to REIT units, and a parallel circular issued the same day does the same for infrastructure investment trusts. The units are held by a SEBI-registered domestic custodian, and the foreign depository may issue receipts only after the custodian confirms it has received them. The receipts can rest on newly issued units or on existing units that current unitholders choose to tender. The circular took effect on the day it was issued. According to SEBI's board papers, six REITs and 26 infrastructure trusts were listed in India on 31 August 2026, so the pool of possible issuers is small.
Who can hold the receipts and who cannot
The circular is direct on this point. A holder of the receipts, including its beneficial owner, cannot be a person resident in India. SEBI's press release on its board meeting of 24 September 2026 said that all foreign investors, including NRIs, can invest in the receipts. The consultation paper of 4 August 2026 had first proposed leaving NRIs out, so their inclusion is a change advisors should note.
For a resident Indian client, the answer is therefore no, and the Liberalised Remittance Scheme does not open a way around it. A resident who wants exposure to Indian REITs buys units on the domestic exchanges in rupees. The receipts matter instead for NRI clients, for families with members who live abroad, and for advisors in the UAE or Singapore whose clients are not Indian residents. Those advisors should apply their own market's rules on who may be offered the product, not India's.
Where the receipts trade and how they are priced
The permitted jurisdiction is the IFSC in India, and the receipts list on India International Exchange or NSE International Exchange. The circular names no single currency and simply calls the receipt a foreign currency denominated instrument. In practice, a client will see a price in a foreign currency on an IFSC exchange rather than a rupee price on the domestic market.
Pricing has a floor. Receipts cannot be issued below the price at which domestic investors receive units through the same kind of issue. A fresh issue also needs at least 75 per cent of the votes cast by unitholders, unless it falls within a limit they have already approved. The circular sets no fixed cap on the size of a programme, so each trust's offer document will show how large its receipt issue can grow. Units cancelled out of receipts can later be reissued as receipts without counting as a fresh issue.
What changes for an NRI client, and what does not
NRIs could already buy Indian REIT units. SEBI's board papers note that NRIs can invest in these units directly under the Foreign Exchange Management (Non-Debt Instruments) Rules, 2019. What the receipts change is the venue and the currency. The client can hold the same economic exposure in a foreign currency on an IFSC exchange, instead of rupee units on a domestic exchange.
Several things stay exactly as they were. The trust still owns the same Indian properties, collects rent in rupees and reports in rupees. Anything the trust discloses on the IFSC exchange must also be filed with the Indian exchange within 24 hours, so the receipt holder sees the same information as a domestic unitholder. Receipt holders vote through the foreign depository, which acts on their instructions.
The currency point needs the most care. A receipt quoted in dollars can feel like a dollar asset, but its value still depends on rupee property prices and on the exchange rate. On 12 November the rupee settled at 94.04 to the US dollar, according to ETV Bharat. If the rupee weakens further, the dollar value of a receipt falls even when the unit price in rupees holds steady. For an NRI client who earns in dirhams or dollars, the receipts add rupee exposure rather than remove it.
The risks to explain before a client buys
The receipts carry the risks of the REIT itself and a few of their own. A client can lose capital if Indian office or shopping centre values fall, if tenants leave, or if the trust's borrowing becomes harder to service. Distributions depend on rent and can be cut or stopped. Holding several REITs through receipts is still a concentrated position in Indian commercial property, and many NRI families already own property in India.
Liquidity is a separate question. Trading in a new instrument on an international exchange may be thin in the early months, which means a client may not be able to sell quickly at a fair price. The circular also says nothing about tax, so the client's position in India and in their country of residence needs separate advice from their CA or tax adviser before any purchase.
What advisors should do as the first receipts are issued
The first step is to confirm each client's residential status before any conversation about the receipts, because a resident cannot hold them at all. Clients who have recently moved abroad, or who plan to return, deserve a careful check of their status for the year in question. The second step is to compare the receipts with the direct route the client already has. An NRI who already holds Indian REIT units on a domestic exchange gains a different currency and venue, not a different asset.
The third step is to read the offer document of any trust that issues receipts, since the size of the programme, the price and the unitholder vote will differ from trust to trust. Advisors should also place the receipts in the client's wider plan. Clients who want property exposure outside India have other routes, including US-listed REITs and private US commercial real estate, each with its own costs, liquidity and risks. Our piece on REITs versus private real estate sets out how those two differ, and the guide to US commercial real estate for advisors explains how private deals are structured. Advisors who introduce eligible clients through Raveum's partner page will recognise the same order of work, because every route starts with where the client lives and whether they are eligible.
SEBI's stated aim, in its press release, was to attract foreign capital into REITs and infrastructure trusts. That is a goal for the market, and it may widen the base of investors in Indian REITs over time. For the advisor, the receipts change how an NRI client holds Indian REIT exposure, not what that exposure is. The client's decision should rest on whether they want more Indian commercial property, priced in rupees, and not on the currency printed on the receipt. Our guide to GIFT City and the other global routes remains the place to start when a client asks how the routes compare.
Frequently asked questions
What are depository receipts?
Depository receipts are negotiable securities that represent shares or units issued in another market. The underlying securities are held by a custodian in the home country, and a foreign depository issues receipts against them. Investors abroad can then hold the exposure in their own market and currency, while the underlying asset stays where it was issued.
What is the difference between an ADR and a GDR?
An American depository receipt is issued in the US against securities of a company from another country. A global depository receipt is the collective term for receipts issued in markets outside the US, such as London, Luxembourg or Singapore. Both work the same way, with the underlying securities held by a custodian in the home market.
Can NRIs invest in REITs in India?
Yes. SEBI's board papers note that NRIs can already invest in Indian REIT units directly under the Foreign Exchange Management (Non-Debt Instruments) Rules, 2019. From November 2026, SEBI's framework also lets NRIs and other foreign investors hold depository receipts on REIT units, quoted in a foreign currency on exchanges in GIFT IFSC.
Can a resident Indian buy REIT depository receipts?
No. SEBI's circular of 2 November 2026 says a holder of the receipts, including its beneficial owner, cannot be a person resident in India. A resident client who wants exposure to Indian REITs can buy units on the domestic stock exchanges in rupees, which carries the same property risks without the foreign currency wrapper.
Where are REIT depository receipts listed?
The receipts list in GIFT IFSC, India's international financial services centre, on India International Exchange or NSE International Exchange. The underlying REIT units are held by a SEBI-registered custodian in India, and anything the trust discloses on the IFSC exchange must also be filed with the Indian stock exchange within 24 hours.
Do REIT depository receipts remove currency risk?
No. The receipt is priced in a foreign currency, but the trust's properties, rent and unit price remain in rupees. If the rupee weakens, the foreign currency value of the receipt can fall even when the rupee unit price is unchanged. For NRI clients earning abroad, the receipts add rupee exposure, alongside the property and liquidity risks.
This article is for general education and is not tax, legal or investment advice. Rules change and depend on individual circumstances. All investing involves risk, including loss of capital, illiquidity and currency movements. Offerings on Raveum are available to eligible investors only and are not open to the general public.
