IndiGrid Reduces Trading Lot Size By Two-Thirds To 1,701 Units
Wind turbines operate beyond electricity pylons in Dewas, Madhya Pradesh, India. (Photographer: Dhiraj Singh/Bloomberg)

IndiGrid Reduces Trading Lot Size By Two-Thirds To 1,701 Units

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IndiGrid, the country's first power sector infrastructure investment trust, on Monday announced reduction of its trading lot size from the current 5,103 units to 1,701 units, meeting new norms of the Securities and Exchange Board of India .

"The newly traded lot sizes will be effective from Sept. 30, 2019. In April 2019, SEBI came out with revised guidelines for determination of allotment and trading lot size for InvITs and REITs (real estate investment trusts) whereby it specified that the minimum value of a single lot i.e. the minimum subscription requirement should be brought down from Rs 5 lakh to Rs 1 lakh for InvITs and to Rs 50,000 in case of REITs," according to a statement by IndiGrid.

SEBI required stock exchanges (NSE and BSE) to implement this reduction in lot size in consultation with the publicly offered InvITs and REITs within six months, the statement added.

This decision by SEBI is expected to go a long way in enhancing liquidity for units and attracting wider participation from retail and high networth individual investors, in addition to institutional investors. The reduction in minimum lot size for InvITs will now allow investors with lower sums of Rs 1-1.5 lakh to invest in InvITs.

It will provide an attractive opportunity for retail investors to earn stable yields with growth by investing in operating infrastructure assets, it said.

IndiGrid Chief Executive Officer Harsh Shah said, "the decision to reduce the lot size by Sebi is a testimony to the reinforced confidence in InvITs as a credible investment alternative for retail investors. In a short span of about two years of coming into their existence, institutional investors as well as retail investors have shown considerable interest for investing in InvITs to earn stable yields."

He also said that besides 57 per cent of foreign institutional investor shareholding, including KKR and GIC, seven domestic insurance companies and four mutual funds have invested in IndiGrid. The value of retail and HNI investors in IndiGrid has increased by more than 1.5 times since its listing in June 2017, Shah added.

IndiGrid has signed framework agreement to acquire three power transmission assets worth Rs 6,500 crore across seven states in India over the next two years in addition to existing assets under management of Rs 10,600 crore.

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