Nexus Select Trust REIT, India’s first retail assets-focused REIT sponsored by global investment giant Blackstone, is seeing more demand after listing at a premium of 3 percent on local bourses on May 19.
Analysts believe, going by the investor interest shown during the bidding period, the REIT may continue to see good volumes in the following days. Moreover, its long-term outlook is also good. Thus, they advise holding if allocated and accumulating if not.
“Allotted investors looking for steady returns should consider holding or accumulating more on listing day as Nexus Select Trust REIT is a good option for yield investors who can expect near about 8.5 percent yield arising from stable cash flows along with decent capital appreciation on long-term,” said Prashanth Tapse, Sr VP Research, Mehta Equities.
The initial public offering of India’s leading consumption centre platform with 17 urban consumption centres across 14 cities received a healthy response from investors last week with subscription at 5.45 times.
The REIT raised Rs 3,200 crore via public issue, of which fresh issue proceeds of Rs 1,400 crore will be utilised for repaying debts of the asset SPVs and the investment entity; acquisition of stake and redemption of debt securities in certain asset SPVs; and general corporate purposes. The rest of Rs 1,800 crore was an offer for sale by unitholders.
Anubhuti Mishra, Equity Research Analyst at Swastika Investmart, said after this positive listing, she recommends investors hold it for the long term with a stop loss at Rs 97 with a view to earning steady returns and appreciation on residual holdings.
Nexus Select Trust has a well-diversified tenant base of 1,044 domestic and international brands with 2,893 stores as of December 2022 and is also diversified across cities with no single asset or tenant contributing more than 18.3 percent and 2.8 percent of total gross rentals for December 2022.
Swapnil Shah, Director - Research, Stoxbox, said the portfolio offers an attractive opportunity to capitalise on India’s consumption growth through a robust business model and diversified asset base that can serve as a natural hedge against inflation.
Moreover, considering the three listed office REITs, Nexus Select Trust offers a differentiated exposure to investors due to its retail assets. Shah said he advises investors who have received allotment to hold shares from a long-term perspective.
Nexus Select Trust is the fourth listed REIT after Embassy Office Parks, Mindspace Business Parks, and Brookfield India Real Estate Trust.
Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
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