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DLF – A weak quarter; Asset sale visibility the key
Launches: No new launches were seen in Q2. Launches have dropped in recent
quarters given its strategy of launching upon receipt of final approvals. Q3, which
is the festive quarter, should see good 3-4msf of launches: plotted development
in Lucknow, Panchkula, Mullanpur and group housing in Gurgaon.
Sales: Q2 should see a drop in sales number as well, as no new launches were
recorded in Q2. Of the total Q1 sales of ~2.2msf, 1.1msf came from new
launches and rest from existing projects in new Gurgaon, Chennai, Bangalore,
Panchkula. Hence we expect significant drop in sales numbers.
Asset sale: In Q2, company has closed a 28 acres land sale in Gurgaon Sector
70A for ~Rs 4.4b; part of the cash has already come in. This sale will get
recognized in Q2 though it is not clear as yet whether this would be treated as
normal course of business (as FSI sale) or other income.
Deleveraging: Debt levels should remain steady in Q2. But the visibility of other
assets sales has improved significantly which should support stock performance-
(1) Pune and Noida SEZ/IT Park sale (~Rs 13b) is in advanced stages; will likely
come through in Q3; (2) Another ~11 acre land sale in Gurgaon should close in
Oct-11 (3) Media reports suggest that Aman resorts sale has seen good interest
from bidders; likely to materialize in FY12.
Financial performance: We expect a weak quarter overall. Revenue will likely
see a dip in Q2 led by (a) lower plotted development sales given no launchessignificant
portion of the sale gets recorded upfront for this asset class; (b)
monsoons generally take a toll on the execution pace. However, bottom-line
impact would be lesser on the back of Gurgaon Rs 4.4b asset sale which will be
reflected in the books in Q2.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
DLF – A weak quarter; Asset sale visibility the key
Launches: No new launches were seen in Q2. Launches have dropped in recent
quarters given its strategy of launching upon receipt of final approvals. Q3, which
is the festive quarter, should see good 3-4msf of launches: plotted development
in Lucknow, Panchkula, Mullanpur and group housing in Gurgaon.
Sales: Q2 should see a drop in sales number as well, as no new launches were
recorded in Q2. Of the total Q1 sales of ~2.2msf, 1.1msf came from new
launches and rest from existing projects in new Gurgaon, Chennai, Bangalore,
Panchkula. Hence we expect significant drop in sales numbers.
Asset sale: In Q2, company has closed a 28 acres land sale in Gurgaon Sector
70A for ~Rs 4.4b; part of the cash has already come in. This sale will get
recognized in Q2 though it is not clear as yet whether this would be treated as
normal course of business (as FSI sale) or other income.
Deleveraging: Debt levels should remain steady in Q2. But the visibility of other
assets sales has improved significantly which should support stock performance-
(1) Pune and Noida SEZ/IT Park sale (~Rs 13b) is in advanced stages; will likely
come through in Q3; (2) Another ~11 acre land sale in Gurgaon should close in
Oct-11 (3) Media reports suggest that Aman resorts sale has seen good interest
from bidders; likely to materialize in FY12.
Financial performance: We expect a weak quarter overall. Revenue will likely
see a dip in Q2 led by (a) lower plotted development sales given no launchessignificant
portion of the sale gets recorded upfront for this asset class; (b)
monsoons generally take a toll on the execution pace. However, bottom-line
impact would be lesser on the back of Gurgaon Rs 4.4b asset sale which will be
reflected in the books in Q2.
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