Analysts advise investors to hold on to the stock and even accumulate at the listing price for the long-term considering the growth visibility.
“Investors who are looking for a decent yield of 8.5% and some kind of capital appreciation on the NAV, should accumulate even now. Nexus Select Trust is into retail property space, in which cash flows are stable. The assets are also in good cities, which gives them brand value,” said Prashanth Tapse, Senior Vice President, Mehta Equities.
Avinash Gorakshakar of Profitmart Securities echoed similar views, advising investors to hold on to the stock from a long-term view.
“90-95% of the profits Nexus generates will be distributed to the unit holders. For conservative investors who want steady cash flows, yields from Nexus Select Trust are likely to be better than debt instruments or fixed income. There is substantial earnings visibility for the company, which will lead to incremental growth,” Gorakshakar said.
Post the listing, the stock further climbed nearly 5% at Rs 104.90 on BSE. Currently, it is trading 1.78% higher at Rs 104.01 on the exchange.
The initial share sale of Blackstone-backed Nexus Select Trust, which comprised fresh issue of Rs 1,400 crore and an OFS of Rs 1,800 crore, was subscribed 5.73 times at close with the institutional investor category getting subscribed 5.04 times, and the other investors part was bid for 6.55 times.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.
Over the last 3 fiscal years, Nexus Select Trust has leased 4.2 msf, added 408 new brands to their tenant base and achieved average re-leasing spreads of 19.2% on approximately 2.9 msf of re-leased space.
The trust will not receive any proceeds from the OFS portion. From the fresh issue net proceeds, the company will be utilising Rs 1,050 crore for the acquisition of stake and redemption of debt securities in certain asset SPVs.
Additionally, Rs 250 crore will be used for partial or full repayment of certain debts of the asset SPVs and the investment entity.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)