Any current/future new fundraising through debt or equity?

As of February 06, 2024, the acquisition deal is not yet finalized; details on debt-equity mix for the planned acquisition remain unclear. The company has a low Loan-to-Value (LTV) ratio of 14%, with a robust balance sheet and a war chest of close to $1 billion earmarked for acquisitions. Recently refinanced debt amounting to INR 9.5 billion at a cost of 8.1%, leading to annual savings of INR 115 million. In-place debt cost has been reduced by 10 basis points to 8.2%, maintaining a dual AAA stable credit rating with no near-term debt maturities. No specific announcements of new fundraising thr

Any current/future capex/capital investment/strategic investment?

Capital expenditure for refurbishing newly acquired malls is typically material and funded through debt. Cap rates considered during acquisition include required upgrade capex, representing an all-inclusive valuation. Investments have been made in upgrading assets including marketing, technology, and IT systems (e.g., over INR 100 crores invested in South India portfolio). Ongoing ESG investments include a 3.3 MW wind power plant under construction for a Chennai mall, expected to meet 60% of its energy needs and deliver INR 60 million EBITDA savings annually with a 20% yield. Technology initia

Future growth expectations in sales/revenue/volumes?

Consumption growth is expected to normalize to high single-digit CAGR (around 9-10%) over the longer term. Tenant sales growth in the nine months ended December 2023 was 14%, indicating strong resilience. Footfall growth was 8% over the nine-month period, with trend per footfall also increasing, supporting sales growth. South portfolio malls have shown 50% sales growth and 33% NOI growth post-acquisition, with room for continued growth over the next couple of years. Leasing spreads achieved on new leases are around 20-26%, showing rent growth potential. Growth prospects are supported by adding

Future growth expectations in earnings/operating earnings/profits/EPS?

Nexus Select Trust projects high single-digit consumption growth CAGR as a base case going forward. NOI (Net Operating Income) growth is expected around 9%-10% in the longer term, with a lag effect behind consumption growth by 100-200 bps. Mark-to-market rental revaluation spreads have been around 20%-26%, providing upside potential in rental income. Distribution growth is expected to be in line with NOI growth, around 9%-10%. The trust anticipates stable renewal spreads of about 20% on lease expiries occurring annually (~0.8 million sq ft). Acquisitions and operational improvements, especiall

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Nexus Select TrustQ4 FY25Realty

Nexus Select Trust Q4 FY25 Earnings Call Analysis

Revenue, margin, capex, fundraise and order book outlook from management commentary.

Price: ₹161P/E: 58.2Market Cap: ₹23.5K CrSector: Realty

Management growth scorecard

Revenue

Category 3

Margin

Category 3

Fundraise

Yes

Order

N/A

Capex

Yes

2 of 4 growth signals are positive.

Full analysis

Revenue guidance

Category 3

→Consumption growth is expected to normalize to high single-digit CAGR (around 9-10%) over the longer term.
→Tenant sales growth in the nine months ended December 2023 was 14%, indicating strong resilience.
→Footfall growth was 8% over the nine-month period, with trend per footfall also increasing, supporting sales growth.
→South portfolio malls have shown 50% sales growth and 33% NOI growth post-acquisition, with room for continued growth over the next couple of years.
→Leasing spreads achieved on new leases are around 20-26%, showing rent growth potential.
→Growth prospects are supported by adding premium brands, improving tenant mix, and digital/omnichannel initiatives.
→Some moderation seen in value and fashion segments, while premium categories (electronics, jewellery) continue to perform well.
→Malls like Select City Delhi expect mid to high single-digit like-for-like rental growth, driving revenue growth further.

Margin guidance

Category 3

→Nexus Select Trust projects high single-digit consumption growth CAGR as a base case going forward.
→NOI (Net Operating Income) growth is expected around 9%-10% in the longer term, with a lag effect behind consumption growth by 100-200 bps.
→Mark-to-market rental revaluation spreads have been around 20%-26%, providing upside potential in rental income.
→Distribution growth is expected to be in line with NOI growth, around 9%-10%.
→The trust anticipates stable renewal spreads of about 20% on lease expiries occurring annually (~0.8 million sq ft).
→Acquisitions and operational improvements, especially in underperforming assets, are expected to be accretive over 12-18 months.
→Tenant sales growth and footfall are key drivers; with technology and better tenant mix, further growth is expected.
→Overall, earnings and distributions should grow consistently with consumption and rental growth trends in retail real estate.

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Fundraise plans

Yes

→As of February 06, 2024, the acquisition deal is not yet finalized; details on debt-equity mix for the planned acquisition remain unclear.
→The company has a low Loan-to-Value (LTV) ratio of 14%, with a robust balance sheet and a war chest of close to $1 billion earmarked for acquisitions.
→Recently refinanced debt amounting to INR 9.5 billion at a cost of 8.1%, leading to annual savings of INR 115 million.
→In-place debt cost has been reduced by 10 basis points to 8.2%, maintaining a dual AAA stable credit rating with no near-term debt maturities.
→No specific announcements of new fundraising through debt or equity at this time; acquisition funding is expected to be partly through debt for one-time capex related to refurbishment.

Order book

The provided document "1284360.pdf" (up to page 15) does not mention any details related to Current/Expected Orderbook or Pending Orders for Nexus Select Trust. The content primarily covers earnings, consumption growth, acquisitions, leasing strategy, tenant sales, and operational performance, but does not discuss orderbook or pending orders. If you have any further specific sections or queries related to orderbook or pending orders, please let me know!

Capex plans

Yes

→Capital expenditure for refurbishing newly acquired malls is typically material and funded through debt.
→Cap rates considered during acquisition include required upgrade capex, representing an all-inclusive valuation.
→Investments have been made in upgrading assets including marketing, technology, and IT systems (e.g., over INR 100 crores invested in South India portfolio).
→Ongoing ESG investments include a 3.3 MW wind power plant under construction for a Chennai mall, expected to meet 60% of its energy needs and deliver INR 60 million EBITDA savings annually with a 20% yield.
→Technology initiatives like the Nexus One App are expanding to more malls by March 2024 to enhance tenant and customer engagement.
→The company has a war chest of close to $1 billion available for acquisitions, indicating readiness for further strategic investments.

How does Nexus Select Trust rank vs peers in Realty?

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1Nexus Select Trust

Rev 3Mar 3

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