Nexus Select Trust REIT IPO: Blackstone-backed Nexus Select Trust REIT’s Rs 3,200 crore IPO opened for subscription on 9 May and the issue garnered 0.27x bids. The QIB portion was subscribed 0.16 times, while the NII portion was bid for 40%. The issue received bids for 5 crore units against 17.6 crore units on offer.
Not more than 75% of the offer is allocated for institutional investors and 25% of the IPO is reserved for non-institutional investors. Nexus Select Trust raised Rs 1,440 crore from anchor investors on 8 May as the anchor book opened and closed for subscription in 8 May. For REIT IPOs, NIIs are those who purchase units worth up to Rs 5 lakh in the trust. The IPO will close for subscription on 11 May, Thursday. The date of allotment of units is projected to be 17 May, Wednesday, following which, the issue is expected to list on the bourses on 19 May.
The issue’s price band has been set at Rs 95-100 per unit. The public offering comprises a fresh issue of units up to Rs 1,400 crore and an offer for sale (OFS) component with unitholders offloading units up to Rs 1,800 crore. The issue size was earlier proposed to be Rs 4,000 crore.
Nexus Select Trust boasts of 17 malls located across 14 cities and according to the RHP, the trust’s portfolio constituted 30% of India’s total discretionary retail spending in FY20 and had an average population. This IPO will be the third REIT sponsored by Blackstone, which launched India’s first REIT, Embassy Office Parks, and then the Mindspace Business Parks REIT. However, while these REITs are focussed on office spaces, Nexus Select Trust will be India’s first listed rent-yielding retail REIT.
“Nexus has expanded significantly in the last three fiscal years and is well-positioned to report continued growth in the future by expanding the tenant base and taking advantage of market opportunities. According to the management, following the utilization of the net proceeds, its leverage will be in a comfortable position, thereby providing it with flexibility to pursue value-accretive acquisitions in the future. Thus we assign a “SUBSCRIBE” rating for the issue,” said Choice Broking.