Blackstone-backed Nexus Select Trust's Rs 3,200-cr IPO to open on May 9, close on May 11

IPO

Global private equity major Blackstone Group-backed Nexus Select Trust will open its initial public offering for subscription on May 9 and close on May 11, in what will be India’s maiden pure-play retail mall REIT offering.

Anchor investors' subscription will open on May 8 and finalisation of the basis of allotment will be on May 16. Initiation of refunds will take place on May 17 and the stock will list on exchanges on May 19.

The total offering of Rs 3,200 crore comprises fresh share issuance of up to Rs 1,400 crore and an offer for sale of up to Rs 1,800 crore.

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Proceeds from the issue worth Rs 250 crore will be used towards repayment and redemption of specific financial liabilities associated with the Asset SPVs and the investment entity. As of December 2022, the Asset SPVs have an outstanding bank loan amount of Rs 4,705.12 crore while the principal amount outstanding towards debt securities is Rs 126.80 crore.

The firm also plans to use Rs 1,050 crore for acquisition of stake and redemption of debt securities in certain Asset SPVs. Nexus Select Trust proposes to utilize part of net proceeds towards acquisition of a 30 percent stake in Nexus Indore Central (NMMCPL) from Olive Commercial Company Ltd. It also plans to acquire 100 percent stake in WRPL and redemption of debt securities issued by WRPL to certain Sponsor Group entities.

Currently, there are three REITs listed on Indian stock exchanges, namely Embassy Office Parks REIT, Mindspace Business Parks REIT, and Brookfield India Real Estate Trust. However, all of these REITs comprise leased office assets. On the other hand, Nexus Select Trust will be the first REIT in India to have rent-yielding retail real estate assets.

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Nexus Select Trust is home to India's largest mall platform, which includes 17 top-quality assets located in densely populated residential areas across 14 prominent cities. Some of the cities where these assets are located include Delhi (Select Citywalk), Navi Mumbai (Nexus Seawoods), Bengaluru (Nexus Koramangala), Chandigarh (Nexus Elante), and Ahmedabad (Nexus Ahmedabad One), among others. Currently, the portfolio has an impressive 96 percent occupancy rate with a diverse tenant base comprising of over 1,000 national and international brands, such as Apple, Zara, H&M, Uniqlo, Sephora, Superdry, Lifestyle, Shoppers Stop, Starbucks, McDonald's, among others, occupying around 3,000 stores.

For FY22, the firm reported revenue of Rs 1,318.21 crore against Rs 906.98 crore a year ago. Net loss for the period narrowed to Rs 10.95 crore from Rs 199.11 crore a year ago. For the nine-month ended December 2022, the firm reported revenue of Rs 1,463.15 crore and net profit was at Rs 257 crore.

Morgan Stanley, JP Morgan, Kotak Mahindra Capital, Axis Capital, and BoA ML are the lead managers to the issue.