DLF Q4 net falls 93%

Written by Corporate Bureau | New Delhi | Updated: May 1 2009, 06:53am hrs
India's largest real estate company, DLF Ltd, on Thursday posted a staggering 92.69% fall in net profit at Rs 159.05 crore for the quarter ended March 31, 2009 against Rs 2,176.82 crore for the corresponding quarter of the previous year.

In a late night filing of its consolidated results with the stock exchanges, the company also announced that revenues had plunged 69% at Rs 1,351 crore for Q4 FY09, against Rs 4,372 crore for Q4 FY08.

The companys annual performance wasnt much better, either. Net profit for the year fell by 41% at Rs 4,629 crore, from Rs 7,812 crore in 2007-08. Revenues also plummeted by 28% at Rs 10,541 crore, from the previous years Rs 14,684 crore.

Commenting on the results, DLF Ltd vice-chairman Rajiv Singh said, The real estate sector bore the brunt of instability and loss of confidence in the local economic environment for the last six months.

Indeed, the real estate sector has been one of the biggest casualties of the ongoing liquidity squeeze and the countrys biggest realtor has also taken a massive jolt. It had a huge short-term debt component of Rs 6,000 crore with a maturity of less than a year, out of which debt worth Rs 3,000 crore was restructured into a long-term debt mainly by securitising cash flows. The quality of the debt portfolio improved substantially, with an average maturity in excess of three years. Its total debt now stands at Rs 15,000 crore.

The company recently slashed property prices by 10-18% in order to increase sales and increase cash flows. The company, like its smaller peers, halted its proposed high-end housing projects and opted for more affordable middle-class housing projects. It sold 450 units in Q4 09 across India in this affordable housing segment.

In line with our earlier projections, the real estate sector should start witnessing recovery from third quarter onwards. In the interim, we would keep a close watch on the market conditions, continue to explore launches of attractively priced residential apartments selectively across the country and respond with appropriate product categories as per customers demands, added Singh.

In order to buoy investor confidence under its buy-back programme, the company has bought back 76,23,567 equity shares up to March 31, 2009 at a price (excluding transaction cost) of Rs 140.34 crore. Of these, 76,18,567 equity shares were extinguished up to March 31, 2009 DLF stocks closed at Rs 230.90 down 2.71% at BSE on Wednesday (markets were closed on Thursday).