The Securities and Exchange Board of India (SEBI) on Friday revised the framework for calculating net distributable cash flows (NDCF) of infrastructure investment trusts (InvITs), allowing certain debt-funded major maintenance expenses for road projects to be added back while calculating cash available for distribution.The move follows requests from industry and recommendations of SEBI’s Hybrid Securities Advisory Committee (HySAC).Under the revised framework, payments towards major maintenance expenses for road projects can be added back to NDCF at both the HoldCo/SPV and InvIT trust levels, but only to the extent they are funded by external borrowing.SEBI has, however, prescribed several safeguards. The road project must fall under the roads and bridges infrastructure sub-sector, while major maintenance will mean expenditure that is not routine maintenance and is in line with the obligations under the concession agreement.InvITs will need approval from unitholders before adding such expenses back to NDCF. The approval requires at least 60 percent of votes cast in favour and must be obtained for each project where the investment manager proposes to raise borrowing for major maintenance.Further, the explanatory statement for the unitholder meeting will have to disclose the projects for which debt is being raised, categories of major maintenance expenses, estimated project-wise and year-wise expenses, and the possible impact on the InvIT’s future growth potential. It must also disclose the present and future impact on distributions to unitholders.SEBI has clarified that the approval can be obtained on a one-time basis for debt already availed or proposed over the project lifecycle, or for a specific maintenance expense. Any additional borrowing beyond the approved proposal will require fresh approval.A statutory auditor will also have to certify that the maintenance expenses comply with concession agreement requirements and have been funded through external borrowing. Only such certified payments will qualify for addition back to NDCF.SEBI has mandated separate disclosures of borrowing for major maintenance, including the amount and percentage of such debt, outstanding debt and debt maturity profiles.Published on August 14, 2026