Real estate major DLF is hopeful of ending the fiscal with “surplus cash generation” on the back of improved collections and demand. The company’s pre-sales guidance continues to be in the Rs 12,000–13,000 crore range.
According to Vivek Anand, Group CFO, DLF, the net debt level came down to Rs 57 crore in Q1FY24 (April to June), one of its lowest ever.
Collections grew 47 per cent year-on-year at Rs 1,580 crore.
Post construction costs and overheads, the company generated a surplus of Rs 670 crore, leading to an increase in cash balance at Rs 2,960 crore, against a gross debt of Rs 3,010 crore.
“We continue to strengthen our balance sheet. Strong collections led to a further reduction in net debt... we have almost achieved our commitment of being net zero and will hopefully end the year with a surplus cash position,” he said during an investor call.
Bookings during Q1FY24 totalled Rs 2,040 crore, which was flat YoY. However, bookings declined 76 per cent on a sequential basis in the absence of new launches during the current quarter. Sales were primarily dependent on ongoing and completed inventory.
The company now has pending inventory to the tune of Rs 5,600 crore from ongoing and completed projects, and expects to launch 10 million sq feet of projects with a revenue potential of Rs 19,000 crore.
“There is a potential for upside risk, depending on the response to the upcoming launch of Crest II [residential complex in Gurugram],” analyst firm Motilal Oswal said in a report.
Key launches
Much of DLF’s 10 million sq ft launches is expected in H2FY24.
Nearly 3.5 million sq ft is in the super-luxury high-rise category in DLF 5, Gurugram; and 1.2 million sq ft is in the high-rise luxury category across projects in Chennai, in the mid- or high-rise category in Gurugram, and a low-rise project in Chandigarh.
The company plans to launch Tower D at its One Midtown property in Delhi by end-Q2FY24 (September-end) and has bookings for 80 per cent of the inventory.
“Our launch inventory continues to witness healthy traction,” Anand said.
Mumbai re-entry
DLF partnered with Trident to develop a 0.9 million sq ft for-sale component at a Slum Rehabilitation Authority (SRA) project in Andheri, Mumbai. The initial phase is part of a large SRA project with a for-sale development potential of 3-3.5 million sq ft.
According to company CEO Ashok Tyagi, DLF will bring in equity of Rs 400 crore for a 51 per cent stake in an SPV, and could take up equity in the main company also at a later stage.
This will be a pilot project for the realtor in Mumbai; based on the success, long-term plans will be firmed up, including commercial projects, the company say.
Under its partnership with Trident, DLF will manage the construction, sales and financial closure of the Mumbai project.