The Full Form of INVIT is‍ Infrastructure Investment Trust.

Infrastructure investment trusts are investment instruments that work like mutual funds and are regulated by the Securities and Exchange Board of India. Abbreviated as InvITs, their units are listed on different trading platforms like stock exchanges and are a wholesome combination of both equity and debt instruments.

The primary objective of InvITs is to promote the infrastructure sector of India by encouraging more individuals to invest in it and can be modified according to a given situation. Typically, such a tool is designed to pool money from several investors to be invested in income-generating assets. The cash flow thus generated is distributed among investors as dividend income. When compared to Real Estate Investment Trust or REITs, the structure and operation of both are quite similar.

Through InvITs, individuals can park their funds into infrastructure projects in two ways, i.e. either directly or through particular purpose vehicles, thus classifying them in two different types.

• Investment in revenue-generating finished projects – 

One of the types allows investment in revenue-generating finished projects and tends to invite investors through a public offering.

• Investment in projects under construction – 

Additionally, investors are also allowed to invest in projects that are under construction or have been finished. Notably, this type opts for a private placement of its units.