REITs are real estate company that offers common shares to the public, representing ownership in an operating business and share most of the profits in form of dividends.

Since REITs are traded on Stock Exchanges one can buy or sell them just like stocks and thus provides easy liquidity to investors.

“We are also looking at introducing REITs... consultations with persons that have better understanding of these products have commenced and shortly we are going to write the first set of proposals,” Sebi Chairman M Damodaran said, on Wednesday, during his key note address at CII’s 2nd Capital Market Summit here.
Sebi was also in the final stages of shaping the norms for the much awaited Real Estate Mutual Fund (REMF).

“The accounting solution for valuation of real estate were being worked out by AMFI and ICAI,” Mr Damodaran assured.

“We will ensure that both the products are made available to the investors and there won’t be any partialty in introducing REMF and REIT,” he added.

In 2008 the regulator planned to launch a nationwide campaign to educate investors and encourage the market particpants to take up the role of self regualting organisations (SROs) more seriously. “Recognising that the informed investor is going to be the backbone of the market Sebi is going to devote calendar Year 2008 to a nationwide investor education campaign,” Mr Damodaran said adding we have already set up our own investor protection fund.

Infrastructure Fund

With regards to Self Regulating Organisations (SROs) Mr Damodaran said it was for those organisations to take up the responsibility. “If people don’t want to regulate themselves, we can do little but we should encourage right sort of people to take up the responsibility,” he said adding in the coming year this should happen.

“The regulations for the Fast Track Security Issuance are ready and 30 large companies will be able to avail fast track for raising money from the market,” he observed. The regulator was also working hard to pace up the development of the corporate bond market.

On the recently announced derivative products, the regulator had already started consultations with the stock  exchanges to see how quickly these new products can be introduced in the market, Mr Damodaran said.

Mr Damodaran also highlighted the response of the foreign investors showing their willingness to come directly to Indian market after the recent curb on the issue of  participatory notes (PNs) by the FIIs.

On the Dedicated Infrastructure Fund announced earlier during the annual Budget for 2007-08, the regulator said that the consultations were nearly over and we should get going soon.