The Hindu Business Line : DLF net profit rises 23% in Q1 on volume growth

New Delhi, July 31 India’s leading real estate company DLF Ltd on Thursday posted nearly 23 per cent rise in its consolidated net profit for the first quarter ended June 2008, to Rs 1,864 crore, on the back of strong volume growth.

DLF’s total revenue, on a consolidated basis, was up 23.2 per cent to Rs 3,846.3 crore compared to the corresponding period of previous year.

The company’s EBIDTA stood at Rs 2,380 crore, an increase of 6 per cent as compared with Rs 2,251 crore in corresponding quarter. The margins were lower as the company moved some volume to mid income housing where the margins stand at about 35 per cent (against 60-70 per cent margins in upper end of the residential market). The non-annualised EPS for the quarter was Rs 10.93.

“We have not sold any new property to DLF Assets (DAL) this quarter, but based on earlier contracts and the progress made, we have recognised revenue (based on percentage completion method) to the extent of Rs 1,557 crore,” Mr Ramesh Sanka, Chief Financial Officer, said. He said that DAL had made payment to the tune of Rs 275 crore towards property transactions this quarter, and currently owes Rs 3,382 crore to the real estate company.

DLF’s Rs 2 shares closed 4 per cent up on the NSE on Thursday at Rs 511.50.

“DAL will look at ways to raise funds through private equity. The possibility of an international listing is out for at least 12 months,” he said.

In a statement issued by the company, Mr Rajiv Singh, Vice-Chairman, said, “Sales of premium homes have been achieved at higher realisations and projects under execution have increased. While we expect a cautious outlook for the year ahead, our new launches, strong backlog and proven execution allow us to remain optimistic about delivering double-digit growth in all facets of our business.”

On the real estate scenario, Mr Singh pointed out that market situation worldwide was unfavourable.

“The increase in interest rates twice during the last quarter will definitely impact the real estate sector. However, the long-term outlook for the sector in our opinion remains unchanged and accordingly, we continue to invest in creating distinctive products to satisfy the demand arising from the growth in diverse sectors of the Indian economy,” he added.

During the quarter, DLF Pramerica Life Insurance received R3 licence from IRDA, enabling it to commence business operations. DLF Pramerica expects to start operations in third quarter of FY09.

More Stories on : Real Estate & Construction | Outlook | DLF Ltd

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page