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Real-estate firm DLF has closed a deal to sell its non-core multiplex business, DT Cinemas, to PVR, but with fewer screens than originally planned. The acquisition was scrutinised by the Competition Commission of India (CCI), which gave its conditional approval last month.
Speaking to Bloomberg TV India , Saurabh Chawla, Senior Executive Director – Finance, DLF, says the company is in talks with other players to divest the remaining screens. Chawla also said that DLF’s commercial real estate is expected to grow over 15 per cent annually going forward. Excerpts.
You have closed a deal with PVR, selling 32 screens of DT Cinemas for ₹433 crore. Can you explain the dynamics of the deal? Was the reduction in screens mutually agreed?
It was not mutual. This was in compliance with a Competition Commission of India order. The CCI directed that if this transaction is to go through, we should divest these screens from the whole portfolio and then sell to PVR.
What are you looking to do with the remaining screens? Are you in talks with other players?
Either we operate them ourselves, or we sell it to competitors of PVR. Those are the two paths we will follow. We are in early stages of our discussions with other players in this space. And hopefully in some time will be able to guide the market as to what we intend to do with the other screens.
Let’s talk about commercial real estate. What target are you looking at?
The commercial segment continues to do well and we continue to invest in that space. We expect the commercial business to grow in excess of 15 per cent annually. On the residential side, yes things are quite soft, especially in some of the micro markets where we have a good presence.
Most real estate players are jostling with heavy debt, rising inventory and non-completion of projects. How are things panning out for DLF?
As a strategy, we have decided to put in additional resources to complete our projects and create more mature inventory so that when demand comes back we are able to sell at better prices. Customers who are actual users, we believe, will give a premium when they see a completed project.
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