The DigiCo Infrastructure REIT (ASX: DGT) share price is rebounding ahead of a briefing from its asset manager with institutional fund managers today.
As reported in The Australian, it is anticipated that DigiCo's manager, HMC Capital Ltd (ASX: HMC), will seek to reassure traders following a sharp two-day sell-off for the market's newest real estate investment trust (REIT).
Yesterday, the DigiCo share price hit an intraday low of $4.02, representing an almost 20% decline from its initial public offering (IPO) price of $5.
DigiCo began trading last Friday on a conditional and deferred settlement basis.
This morning, the DigiCo share price hit an intraday high of $4.50 in early trading, up 4.65%.
The ASX REIT is currently trading at $4.47, up 4.07%.
Meantime, the S&P/ASX All Ordinaries Index (ASX: XAO) is up 0.39%.
Investors have also punished HMC Capital shares since DigiCo began trading.
The HMC Capital share price has fallen 18.27% since the closing bell last Thursday.
The HMC Capital share price is currently $9.93, up 2.06% today.
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What is DigiCo?
DigiCo is an ASX REIT with a portfolio of 13 data centres that it will own, operate, and develop in tier one and tier two locations along Australia's East Coast and in Adelaide, as well as the United States.
Data centres are in strong demand amid a wave of growth in the artificial intelligence (AI) arena.
On its first day of trading, DigiCo announced its biggest acquisition to date — the Global Switch property in Sydney's CBD.
DigiCo will pay $1,936 million for the property, which is expected to contribute 72.5% of the REIT's forecast revenue (excluding interest income) for the period 18 December to 30 June 2025.
DigiCo has paid $3,956 million in total for its starting portfolio of 13 assets.
Including the Global Switch purchase, DigiCo has $1,945 million in borrowings and $452 million in cash and cash equivalents on its balance sheet.
DigiCo expects to deliver a pro forma annualised FY25 adjusted EBITDA of $97 million.
The DigiCo REIT raised $1,995 million pursuant to the offer under its replacement prospectus.
DigiCo will use the proceeds to fund the initial portfolio and continue the development of the greenfield sites within it.
According to the prospectus, DigiCo is exposed to structural tailwinds in the global economy:
The asset class is underpinned by structural tailwinds including increasing growth in data creation
and consumption, digitalisation of businesses, growing reliance on the cloud, adoption of next
generation technologies including artificial intelligence, the acceleration of the technology sector
globally and increased outsourcing of data centre services to specialised operators.
What's next for DigiCo shares?
DigiCo announced the settlement and allotment of its IPO stapled shares shortly after the market open today.
DigiCo REIT shares will commence trading on a normal settlement basis tomorrow.
