Geojit IPO report on Nexus Select Trust
Nexus Select Trust (NST) is the owner of India’s leading consumption centre platform, comprising 17 Grade-A best-in-class urban consumption centres with a total leasable area of 9.2 msf spread across 14 leading cities in India such as Delhi, Navi Mumbai, Bengaluru, Pune, Hyderabad, and Chennai. The NST’s portfolio is highly stabilized, with a committed occupancy of 96.2% and 5.7-year WALE (weighted average lease expiry) as of December 31, 2022. Their portfolio has a tenant base of 1,044 domestic and international brands with 2,893 stores as of 9MFY23. Consumption accounted for ~60% of India’s GDP in FY22 and has grown at 10% CAGR between CY14-21, led by strong tailwinds like young population, growing middle class, and rapid urbanisation. As one of the leading consumption centre platform in India (by completed area), NST’s portfolio is well-positioned to capitalise on strong consumption growth, powered by marquee tenant base and consumer outreach initiatives.
Valuation and Outlook
Considering the strong growth story in consumption space, healthy projected net operating income (NOI) growth of ~17% over FY24-26E, capital appreciation prospects, and healthy balance sheet with lower LTV ratio, we assign a “Subscribe” rating on a long term basis.
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