Nexus Select REIT IPO subscribed 28% on Day 1, non-QIB portion subscribed 42%

The public issue of Blackstone-backed Nexus Select Trust real estate investment trust (REIT), was subscribed 28% on the first day today.

The REIT opened for subscription on Tuesday, and will close on May 11. The company has set a price band of Rs 95-100 per unit.

The issue consists of a fresh offering and OFS portion. The fresh issue is worth Rs 1,400 crore and an offer-for-sale is up to Rs 1,800 crore.

The portion set aside for qualified institutional buyers was subscribed 17% and the non-QIB portion was subscribed 42%.

A day ahead of the public issue, the company raised Rs 1,440 crore from anchor investors.

HDFC Trustee, HDFC Life Insurance, SBI Life Insurance, IIFL Opportunities Fund, Star Health and Allied Insurance, SBI General Insurance, Reliance General Insurance, Morgan Stanley Asia, and Tata Investment Corp were among the institutional investors that participated in the anchor placement.
REIT, a popular instrument globally, was introduced in India a few years ago to attract investment in the real estate sector by monetising rent-yielding assets. It helps unlock the massive value of real estate assets and enables the participation of retail investors.

At the upper band of Rs 100 per unit, the company commands a market cap of Rs 15,150 crore and the issue is at Price/NAV of 0.78x. It is offering a pre-tax yield of 8% in FY24, at the upper price band.

Upon listing, Nexus will be India’s first REIT with rent-yielding retail real estate assets.

Nexus Select Trust is India’s largest mall platform of 17 high-quality assets, strategically located in dense residential catchments across 14 prominent cities.
The portfolio comprises 17 Grade A urban consumption centres with a total leasable area of 9.2 msf, 2 complementary hotel assets (354 keys) and 3 office assets (1.3 msf) as of December 2022.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)