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Real estate major DLF has seen a 4.2 per cent rise in net debt to ₹22,520 crore in the July-September quarter from ₹21,598 crore in the April-June quarter of 2015-16, according to an analyst presentation the company made after announcing its financial results for the second quarter.
Of this ₹22,520-crore debt, the rental business arm (RentCo) accounts for ₹14,300 crore and the development arm (DevCo) accounts for ₹8,220 crore.
The company aims to create a large rental business platform in partnership with large, long-term, institutional investors, it said.
In October, the company had announced that its promoters will sell 40 per cent stake in the company's arm DLF Cyber City Developers Ltd (DCCDL) to institutional investors. The decision was based on the recommendation of the audit committee set up last year to suggest ways to drive the growth of the rental business.
Following the completion of the proposed transaction, DLF will continue to hold 60 per cent equity interest in DCCDL on a fully diluted basis, the company said in the presentation.
As far as RentCo is concerned, the company’s net leasing was negative for the second quarter. “Gross leasing was 0.83 million square feet (msf) and terminations 0.91 msf. The terminations have been according to the budgetary plan. New leasing is happening at rates substantially higher than the exit leasing rates of the terminations. Given the pipeline of new leasing, the company is confident of achieving net leasing of 1-1.5 msf for FY16,” the presentation said.
For the real estate major’s Mall of India Noida, 1.50 msf of the gross leasable area of 1.97 msf has been leased out and is expected to be operational by the third quarter of this fiscal, the company said.
It has also urged the Government to take more pro-active steps in close coordination with the RBI to provide liquidity to stalled developments.
“Even though well intentioned, some provisions of the current draft of the Real Estate Regulatory Bill will harm the sector more as it effects the consumer adversely in the absence of clear initiatives to resolve delays in regulatory approvals. Besides, an additional layer of approvals would only cause delays in delivery and increased pricing,” it said.
The company reported a 20.5 per cent rise in net profit at ₹131.50 crore for the July-September quarter of financial year 2015-16 against ₹109.06 crore in the corresponding quarter last fiscal. In a filing to the BSE on Tuesday, the company reported a 7.3 per cent drop in income from operations at ₹1,865.49 crore.
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