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Brookfield REIT IPO: Issue Subscribed 77% On Day 2 (Economic Times)

February 5, 2021- The initial public offer (IPO) of Brookfield India Real Estate Trust was subscribed 77 per cent by the end of the second day of bidding today, driven largely by corporate and individual investors.

The issue received applications for 58,818,600 units by 5:00 pm. The corporate and retain individuals’ portion was fully subscribed by the end of the second day, whereas the allotment for institutional investors was subscribed 53 per cent.

The low turnout by institutional investors is in line with usual trends, as they typically bid for any IPO on the last day. The Brookfields REIT issue — which is the third ever REIT to be launched in India — is set to close on Friday.

Analysts are mixed on the issue. Some have advised subscribing to the issue from a long-term perspective, while others are neutral on it because citing uncertainties around the company’s weak financials and high debt on the books.

Yash Gupta of Angel Broking said that due to the current uncertainties around Covid-19 and proliferation of work from home, “we expect that demand for commercial real estate to be muted”.

“Though the REIT has incurred losses in FY20 and has not paid out any dividends, they expect to pay a yield of 7.5 per cent in FY23 which we believe is aggressive and may be difficult to achieve,” he said.

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