DLF may not gain much from stake sale in Aman Resorts
Feb 11, 2014
Source : The Economic Times

 

DELHI: The stake sale in Aman Resorts may not have a significant impact on the earnings of real estate developer DLF. Despite several asset sales in the past, DLF's stock has halved in the past one year due to the company's weak operational and financial performance.

The overall realty demand in the NCR remains sluggish due to a subdued macro-environment. Sales at DLFBSE -0.42 % were down 45% quarter-on-quarter in the three months to September.

Besides, the amount received from this sale is quite small in comparison to the total net debt of the company. At the end of September, DLF's net debt (total debt less cash) stood at Rs 19,500 crore.

DLF will receive about Rs 2,200 crore from the sale of Aman Resorts and save Rs 270 crore in interest. Compare this with the total interest it paid in FY13 - Rs 3,243 crore on a net debt of Rs 23,000 crore.

In the profit and loss statement, DLF accounted only Rs 2,314 crore as interest expense due to accounting method and its EBIT (earnings before interest and tax) was only Rs 3,100 crore, marginally above the interest expense.

By the end of FY14, DLF's net debt will be down to Rs 17,500 crore due to cash from asset sales, but the question is will it really help it improve earnings?

Since the beginning of FY09 till December-end FY14, company has monetised non-core assets worth Rs 8,700 crore. However, interest outgoes have continued to rise and earnings are declining.

Despite frequent asset sales over the past two years, DLF's interest outgo in the first six months of the current fiscal was one of the highest in its history, at Rs 1,200 crore. As against this, its adjusted net profit was only Rs 228.5 crore, lowest since its listing in 2007. Also, the net operating cash flows, excluding one-offs, in the first half were negative.

 

 

 

Latest Realty News

Gurgaon: Sector’s growth engine in the NCR
Feb 11, 2014
DELHI: Investments in real estate have been one of the greatest wealth builders in history. However, such investments have to be well gauged and thoroughly researched, a report by DTZ says. Over the years, a few micromarkets in the Delhi NCR have emerged as destinations for future investments, which are not only providing relative affordability but are also undergoing significant transformations owing to infrastructural development, improving connectivity, and the potential to attract real estat
Haryana approves RIL’s quitting Gurgaon SEZ
Feb 10, 2014
CHANDIGARH: Haryana government today approved Reliance Industries’ proposal to opt out of SEZ in Gurgaon and said it will reimburse Rs 343 crore to it, lower than Rs 1,172 crore demanded by the company, for taking back the land.
More properties go under hammer as borrowers under stress: Assocham
Feb 10, 2014
DELHI: An increasing number of properties and assets mortgaged to lenders are going under the hammer due to non-payment of loans, a study by Assocham has found. “Visibly, the sale and possession notices appear more for the small-sized assets mortgaged for loans which have gone bad. The stress seems more in small-sized manufacturing units,” the study paper said.
Indian economy to grow at 4.9 percent in 2013-14
Feb 08, 2014
DELHI: The Indian economy is expected to grow by 4.9 percent in the financial year ending March 31, 2014 as compared to 4.5 percent expansion recorded in the previous year, government data showed Friday.
Services sector contracts for 7th straight month: PMI
Feb 08, 2014
DELHI: In January, India’s services sector contracted for a seventh consecutive month, showed the HSBC Purchasing Managers’ Index (PMI).
Planned urban infrastructure key to growth in Delhi-NCR
Feb 08, 2014
DELHI: Investment inreal estate in the long term is always rewarding. Among all the asset classes, the long-term real returns from real estate are the highest. But for this, one must find out the right areas to invest. In the Delhi NCR, there are a number of pockets, where the return can be very good.
Is it sensible to buy resale flats?
Feb 08, 2014
DELHI: Rahul was tired of shifting flats due to the ever increasing rental rates in Delhi until he decided to invest his money in purchasing a resale flat. In addition to a hefty discount, the flat came readymade with an instant-shift tag. Rahul can now spend the saved money on the interior decor and can flaunt his cheap yet elegant home to his colleagues.
Tata Housing to invest Rs 300 cr on housing project in Chennai
Feb 08, 2014
DELHI: Tata Housing will invest Rs 300 crore on developing a new housing project near Chennai.The project 'Santorini', spread over 18 acres, comprises 1,000 housing units. Located on Chennai-Bangalore highway at Sriperumbudur, the project will be developed by its subsidiary Tata Value Homes Ltd.
Where to focus when building your dream home?
Feb 08, 2014
DELHI: Karan, a money-conscious individual, had managed to accumulate enough funds while working as a software engineer in Delhi and decided to invest them in his dream home. He was aware of the process related to purchasing a land and hiring a contractor. However, little did he know that constructing a home requires following a practical and scrutinized construction plan. The things did not go as per the plan and Karan had to settle down with an inferior and below par home.
Govt to launch Integrated Processing Development Scheme
Feb 07, 2014
DELHI: To address the environmental issues faced by textile processing units, the government will come out with a new Integrated Processing Development Scheme, Parliament was informed today.

Latest Realty News Of State

Realty Talk's