Infrastructure investment trust

A trust that owns operating infrastructure, such as toll roads, power transmission lines, pipelines or telecom towers, and distributes most of its cash flow to unitholders. Indian InvITs are regulated by SEBI and must distribute at least 90% of their net distributable cash flow.

Many of their assets have finite lives. A toll road concession that ends in fifteen years returns nothing after that, so part of every distribution is a return of capital rather than income. A unit paying ₹9 a year on a ₹100 price for fifteen more years and nothing after, discounted at 10%, is worth about ₹68, so its 9% yield isn't a 9% return.

Value one as the present value of the distributions to the end of each concession or licence, and compare that with the price. Don't read the yield as if it lasted forever.

On a finite asset, the yield is part repayment.