India’s infrastructure investment trust (InvIT) market has witnessed rapid expansion over the past three years, with assets under management (AUM) more than doubling from ₹3 lakh crore in FY22 to ₹6.25 lakh crore by FY25, according to a report by CareEdge Ratings.

The number of InvITs has also increased from 11 in FY22 to 22 in FY25, reflecting growing investor appetite and the accelerating institutionalisation of operational infrastructure platforms. The rating agency expects this momentum to continue, with AUM likely to rise by another ₹1 lakh crore in FY26, taking the total to around ₹7.5 lakh crore.

“InvITs are expected to witness another year of steady growth in FY26, with nearly ₹1 lakh crore of additional AUM driven by the roads, warehousing, transmission, and renewable energy sectors,” the report said.

Telecom, roads dominate InvIT landscape

Despite the strong growth, the InvIT landscape remains highly concentrated, with telecom and road assets together accounting for nearly 90% of the total AUM as of March 31, 2025, the report noted. Telecom InvITs lead the pack with an AUM of about ₹3.06 lakh crore, supported by strong structural demand such as rising data consumption and internet penetration. Road InvITs follow with ₹2.46 lakh crore in AUM, driven by a robust pipeline of highway monetisation projects.

CareEdge noted that roads continue to be the most active segment in terms of deal flow, with 15 road InvITs holding 178 assets. The monetisation potential from operational highway assets remains significant, with around ₹2 lakh crore worth of HAM (Hybrid Annuity Model) projects expected to be monetised over the medium term. However, challenges such as lower valuation multiples and limited availability of mature toll assets may impact pricing and pace.

As per the report, beyond roads and telecom, diversification is gradually picking up. Transmission InvITs, backed by long-term regulated tariffs, offer strong revenue visibility, with AUM of about ₹42,500 crore. The segment is supported by a large investment pipeline of ₹4.86 lakh crore through FY31, driven by rising power demand.

Transmission, renewables, warehousing gain traction

The report highlighted that renewables and warehousing are emerging as key growth areas. While the renewable InvIT space is still nascent, with one InvIT managing 1.1 GW capacity, it benefits from India’s ambitious target of 460 GW renewable capacity by FY30. Warehousing InvITs, though small at around ₹11,500 crore AUM, are gaining traction amid strong demand from e-commerce and logistics sectors, with occupancy levels expected to remain healthy.

On the funding side, InvITs have mobilised around ₹88,000 crore of equity between FY23 and FY25, taking the total unit capital to ₹1.93 lakh crore. The trend is expected to continue in FY26, with fresh equity issuance of about ₹16,500 crore likely from road and transmission InvITs, along with new launches.

Debt levels remain elevated but stable, with aggregate borrowings at ₹2.82 lakh crore as of FY25. Bank loans dominate the funding mix, accounting for nearly two-thirds of borrowings, while bond market participation remains relatively low at about 20%.

“Leverage levels are expected to remain stable at around 49% in FY26, aided by valuation gains and continued equity issuances. Bond market participation is likely to stay moderate, representing approximately 20% of the estimated ₹3.70 lakh crore in debt as of March 31, 2026,” said Maulesh Desai, Director at CareEdge Ratings.

He said that InvITs are set for another year of steady growth, supported by asset monetisation under the government’s National Monetisation Pipeline (NMP-II), increasing investor participation, and a steady pipeline of operational assets across sectors.

“As InvITs continue to scale, maintaining an optimal balance among growth aspirations, asset valuations, and funding access will be critical to sustaining momentum and ensuring continued investor confidence,” said Palak Vyas, Associate Director at CareEdge Ratings.

Recent market activity

The report further highlighted that there is need to deepen the domestic investor base, particularly among retail investors, mutual funds, and insurance companies, while also improving creditor protections. As the sector scales up, maintaining a balance between growth, valuations, and funding access will be critical to sustaining investor confidence and long-term momentum.

Last week, Raajmarg Infrastructure Investment Trust, the first publicly listed InvIT sponsored by the National Highways Authority of India (NHAI), raised ₹6,000 crore from the primary market. This week, Cube Highways Trust (Cube InvIT) has filed for the country’s first conversion of a privately listed InvIT into a publicly listed one, proposing an offer for sale (OFS) of up to ₹5,000 crore.