NSE has decided to revise the eligibility criteria for inclusion in Nifty Indices. What this means is, besides Equity, REITs (Real Estate Investment Trusts) and InvITs (Infrastructure Investment Trusts) can now be included in Nifty Indices.
Before jumping into the circular, I think it is essential to understand what REITs and InvITs are. Here’s a small read to understand the basics of how they function 
What are REITs?
A Real Estate Investment Trust (REIT) is a trust that owns and operates income-gaining real estate assets.
REITs are created for the purpose of funneling funds into owning, financing, or operating income-generating real estate. REITs work on similar lines of Mutual Funds. They provide investors a very fluid way to invest in real estate, which is otherwise very illiquid.
REITs own various types of commercial real estate - office spaces, apartment complexes, warehouses, hospitals, lodges, motels, and shopping malls.
Read more on REITs here.
What are InvITs?
Infrastructure Investment Trusts (InvITs) are trusts which raise money to invest in infrastructure projects.
InvITs can invest in upcoming projects, completed projects, or a mix of both. Like REITs, InvITs operate similar to Mutual Funds. The idea is to just raise funds and invest them. The earnings gained from these investments will be apportioned to the investors over a period of time.
Read more on InvITs here.
Both REITs and InvITs are listed on the exchange as securities that can be traded. They are a decent investment opportunity when it comes to diversifying your portfolio.
| REITs | |||
|---|---|---|---|
| Sr. No. | Name | Symbol | Free Float Market Cap (₹ Crores) |
| 1 | Brookfield India Real Estate Trust | BIRET | 3,539.88 |
| 2 | Embassy Office Parks REIT | EMBASSY | 16,354.96 |
| 3 | Mindspace Business Parks REIT | MINDSPACE | 6,354.31 |
| InvITs | |||
|---|---|---|---|
| Sr. No | Name | Symbol | Free Float Market Cap (₹ Crores) |
| 1 | India Grid Trust | INDIGRID | 7,213.64 |
| 2 | IRB InvIT Fund | IRBINVIT | 2,577.2 |
| 3 | POWERGRID Infrastructure Investment Trust | PGINVIT | 9,420.45 |
What does the circular from NSE mean? What actually changes?
Now that you know what REITs and INvITs are, this should be very simple. The circular simply says that REITs and InvITs can also be included in the Nifty Indices, which was previously restricted to just all equity shares.
| Existing Criteria | Revised Criteria |
|---|---|
| All equity shares that are traded (listed & traded and not listed but permitted to trade) at NSE are eligible for inclusion in the Nifty Indices. | All equity shares, REITs, and InvITs that are traded (listed & traded and not listed but permitted to trade) at NSE are eligible for inclusion in Nifty Indices. |
Below are the Indices in which REITs will be included:
Nifty 500:
| Sr. No. | Name | Symbol |
|---|---|---|
| 1 | Brookfield India Real Estate Trust | BIRET |
| 2 | Embassy Office Parks REIT | EMBASSY |
| 3 | Mindspace Business Parks REIT | MINDSPACE |
The changes will come into effect from September 30, 2021. You can check the announcement from NSE Indices here.