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DLF Ltd, India's largest real estate player, has struck a note of caution on the demand environment.
Stating that it did not want to be “hyper-optimistic” on economic conditions, DLF said its key business strategies will continue to focus conserving cash and protecting margins through cost escalation clauses.
In a presentation to analysts after reporting its Q4 earnings, DLF said, “These are difficult conditions and headwinds will continue. Given the inflation, we can't be hyper optimistic. We are focussing on debt reduction by selling our non-core assets and focussing on plotted developments,” said Mr Ashok Tyagi, CFO, DLF.
Speaking on the non-core asset divestment -- the proceeds of which will go towards debt reduction, DLF said it hopes to achieve closure in next few months. “Funding agreements are in place and we should announce the deal by first half of this fiscal.”
DLF has been mulling sale of its non-core assets including Aman Hotel, a Mumbai land tract and wind energy business to prune its debts. DLF's net debt stands at Rs 22,725 crore as on March 31, 2012.
“We hope that our non-core assets sale will help us get about Rs 4,000 crore in the next six-eight months.”
It plans to reduce debt by strengthening operational cash flows, enhancing momentum on non-core divestments along with a moderation in land aggregation and capex.
Consolidated net dips in Q4
DLF had reported a 39 per cent fall in its consolidated net profit at Rs 211.70 crore for the quarter ended March 31, 2012, on account of higher interest outgo.
It had posted a profit of Rs 344.54 crore a year-ago period. The revenue fell by four per cent to Rs 2,747 crore in the Q4 of 2011-12 fiscal from Rs 2,870 crore in the corresponding period of previous fiscal.
For the year ended March 31, 2012, the net profit fell by 27 per cent to Rs 1,200.82 crore from Rs 1,639.61 crore in the previous fiscal. The revenue rose marginally at Rs 10,224 crore in 2011-12 from Rs 10,144 crore in 2010-11 fiscal.
The board recommended a dividend of Rs 2 a share on equity shares of Rs 2 each, for 2011-12 fiscal.
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