The Securities and Exchange Board of India (“SEBI”) has issued a circular clarifying the permitted use of fresh borrowings by Infrastructure Investment Trusts (InvITs) when net borrowings exceed 49% of the value of InvIT assets. The clarification follows the amendment to Regulation 20(3)(b)(ii) of the SEBI (Infrastructure Investment Trusts) Regulations, 2014 on April 17, 2026. SEBI has specified that such borrowings may be used for capital expenditure aimed at enhancing asset performance or increasing capacity, major maintenance expenses for road projects, and refinancing of debt subject to conditions. For road projects, major maintenance must be non-routine and aligned with concession agreement obligations. Refinancing is permitted only where the original debt was used for eligible purposes and only the principal amount can be refinanced, excluding accumulated interest, charges, or fees. The circular takes immediate effect and has been issued under SEBI’s statutory powers.
Securities and Exchange Board of India
Circular No. SEBI/HO/DDHS/DDHS-PoD-2/ I/11700/2026 | Dated: May 15, 2026
To,
All Infrastructure Investment Trusts (“InvITs”)
All Parties to InvITs
All Depositories
All Recognized Stock Exchanges
Madam / Sir,
Subject: Permitted use of fresh borrowings for InvITs where Net Borrowings exceeds forty-nine percent of the value of InvIT assets
1. Regulation 20(3)(b)(ii) SEBI (Infrastructure Investment Trusts) Regulations, 2014 (“InvIT Regulations”) was amended on April 17, 2026 to expand the permissible use of borrowings above forty-nine percent in the manner as specified by the Board
2. Accordingly, the following shall be considered as permissible use of borrowing above forty-nine percent under Regulation 20(3)(b)(ii) of InvIT Regulations–
2.1. Capital expenditure made to enhance asset performance or for capacity augmentation;
2.2. Major maintenance expense in respect of Road Project, wherein –
2.2.1. Major maintenance expense shall mean expenditure incurred on maintenance of road project which is not routine maintenance and is in accordance with the obligations and requirements specified in the concession agreement;
2.2.2. Road Project shall mean a project in the ‘Roads and bridges’ infrastructure sub-sector as mentioned in the notification of the Ministry of Finance dated September 19, 2025 and shall include any amendments or additions made thereto.
2.3. Refinancing of debt, by the InvIT, SPV or Holdco, subject to the following conditions:
2.3.1. the original debt which is being refinanced was utilized for the purposes permitted under Regulation 20(3)(b)(ii) of the InvIT Regulations;
2.3.2. only the principal portion of debt is refinanced i.e. any accumulated interest or any charges or fees by whatever name called shall not be refinanced.
3. This circular shall come into force with immediate effect.
4. This circular is issued in exercise of the powers conferred under Section 11(1) of the Securities and Exchange Board of India Act, 1992, Regulation 20(3)(b)(ii) and Regulation 33 of the SEBI (Infrastructure Investment Trusts) Regulations, 2014. This circular is issued with the approval of the competent authority.
5. The recognized Stock Exchanges are advised to disseminate the contents of this Circular on their website.
6. This circular is available on the website of Securities and Exchange Board of India at sebi.gov.in under the category “Legal → Circulars”.
Yours faithfully
Ritesh Nandwani
Deputy General Manager
Department of Debt and Hybrid Securities
Tel No. +91-22-2644 9696
Email id – riteshn@sebi.gov.in
