DLF, one of India’s leading real estate developers, has posted an impressive performance in the first quarter of the fiscal year. Despite no new launches during this period, the company managed to record robust presales of INR 20.4 billion, demonstrating the strength of its existing portfolio and the sustained demand in the real estate sector.
DLF Strategic Re-entry into MMR
In a significant development, DLF has announced its strategic re-entry into the Mumbai Metropolitan Region (MMR) market. The company is set to undertake a slum rehabilitation project in Andheri, marking its comeback in the region. This move is expected to bolster DLF’s presence in the lucrative MMR real estate market.
A High-Rise Premium Project on the Horizon
The Andheri project, which marks DLF’s re-entry into the MMR market, is expected to be a high-rise premium project. The first phase of the project will offer a saleable area of 0.9 million square feet (msf), with a Gross Development Value (GDV) of around INR 20 billion. This project is a joint venture, with DLF holding a majority share of 51%.
Significant Debt Reduction and Strong Cash Position
DLF has also managed to significantly reduce its net debt to INR 570 million, down from INR 7.2 billion in Q4FY23. This reduction is attributed to strong collections of INR 15.7 billion during the quarter. Furthermore, DLF’s cash position is robust at INR 30 billion, which is earmarked for growth, dividend payout, and further debt reduction.
A Positive Outlook
HDFC Securities has maintained a ‘BUY’ rating on DLF, with a target price (TP) of INR 504 per share. This positive outlook is based on DLF’s strong Q1 performance, its strategic re-entry into the MMR market, and its plans for future growth.
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Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Sharedhan. We advise investors to check with certified experts before taking any investment decisions.
