Amid the current turbulent macro-environment, India’s second listed REIT, Mindspace Business Parks, has shown resilience in cash flows with the strong rental collection. The K Raheja Corp promoted Mindspace REIT made a strong debut on bourses on August 7, becoming the second such to get listed after Embassy Office Parks REIT.Analysts believe that Mindspace’s high tenant retention rate, low in-place rents (Rs 52/psf) and sharp supply contraction in the key market of Hyderabad position it well to skirt the near-term uncertainty in the office leasing market.BofA Securities has initiated coverage on Mindspace with a Buy rating and target price of Rs 342 per unit, given its strong Net Operating Income (NOI) growth outlook of 56 percent over FY20-23 and attractive dividend yield of 6.8 percent (FY22 basis).“58 percent of Mindspace’s NOI growth over next three years is likely to be led by contracted escalations and mark-to-market (MTM) potential. Both the parameters have remained resilient so far in the current sluggish market conditions. The remaining growth could be on back of lease-up of vacant area and under-construction properties.Given favorable end-market dynamics in both the key markets of Hyderabad (supply correction) and NaviMumbai (sharply lower prices vs. neighborhood, improving infrastructure), we see a high likelihood of this coming through. We expect NOI growth to percolate down as dividend growth given an even outlook for interest payments and a single-tier REIT structure,” BofA Securities said in a report.Mindspace Business Parks REIT owns five integrated business parks and five quality independent office assets across India with 23.0 msf of completed leasable area, 2.8 msf of under construction area and 3.7 msf of future development pipeline. The portfolio is stabilized with 92 percent Committed Occupancy and a Weighted Average Lease Expiry (WALE) of 5.8 years.The assets are located in Hyderabad, Mumbai Region, Pune and Chennai. Mindspace REIT has a tenant base of 172 companies across its assets, with MNCs contributing ~85 percent of the gross rentals as of March 2020.Global brokerage Morgan Stanley believes Mindspace REIT is a defensive stock with midteen IRR potential. The trust enjoys stable cash flows from rental income coupled with growth in income and capital appreciation of underlying property values, it said.Mindspace REIT has a strong multinational tenant profile with long lease tenures (10 or 15 years). Large upfront fit-out-related capex by occupiers fosters their long-term and stable occupancy, the brokerage added.It forecasts 12.5 percent and 7 percent two-year (F22-23) CAGRs for EBITDA and net distributable cash flow (NDCF), respectively, driven by contractual rent escalation, mark-to-market upside for expiring leases, and new development.“Mindspace REIT has a strong balance sheet, with 25 percent net gearing in F21, allowing financial flexibility to grow organically and inorganically,” Morgan Stanley said.The brokerage initiated the coverage with an Overweight rating and a target price of Rs 333.Meanwhile, domestic brokerage ICICI Securities believes that the Indian office market retains many positives such as a limited number of 8-10 pan-India developers capable of building quality rental assets and India remains one of the more affordable office markets in the world, with average rentals for Grade A office markets in peripheral/suburban markets hovering around $1/psf/month or Rs 70-75/psf/month.The brokerage initiates coverage on Mindspace Business Parks REIT with a Buy rating and a target price of Rs 358/unit.“With 92 percent committed occupancy and in-place rent of just Rs 52/psf/month, we like the company given 16 percent NOI CAGR over FY20-23E, a resilient leasing cycle for office assets in India’s tier I cities and low leverage of 0.2x net debt/equity which leaves headroom for injection of new assets in the REIT portfolio,” ICICI Securities said.The REIT has reported resilient rental collections of 95-99 percent in the March-May 2020 period post-onset of COVID-19 (in line with listed peers) and has leased 0.7 msf of area (of which 40.5 percent was leased to its existing tenants and 59.5 percent was leased to new tenants, it noted.On August 7, the Mindspace Business Parks REIT got listed at Rs 304 on BSE, a 10.55 percent premium over its issue price of Rs 275. It made a low of Rs 298.50 per unit on August 13 while a high of Rs 316.40 on August 21.At 1 pm, it traded at 301.50 per unit, up 0.13 percent.