The Hindu Business Line : DLF's mega foray

Rarely does the filing of a draft prospectus with the regulator create a flutter among corporate circles. This, however, is no ordinary filing. The Kushal Pal Singh-promoted DLF Universal's plans to mobilise over Rs 11,000 crore from the primary market is billed as the largest IPO, likely to displace ONGC from the title it has enjoyed so far.

This IPO will also validate the emergence of real estate as a proxy asset class, in the absence of Real Estate Investment Trusts (REIT) as an investment option. The company, credited with the creation of DLF City, an integrated township in Gurgaon, will aim to replicate this real estate magic across the country. Preliminary estimates from leading real estate consultants suggest that the commercial space created in the country is less than that of Shanghai and Beijing put together. And a recent Nasscom-McKinsey report on the software industry suggests if the Indian software sector is to touch projected revenues of $60 billion by 2010 ($23 billion today), this sector alone will need at least five new "Gurgaon plus" and five to seven "Pune plus" kind of integrated townships. If the IPO sails through, it is expected to catapult DLF into a completely different league, with the company set to being among the top five by market cap in India and a key player in the Asian real estate sweepstakes.

Krishnan Thiagarajan

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