DLFNSEOctober 31, 2023

DLF Limited

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90turns

9analyst exchanges

7executives

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Management on call

Ashok Kumar Tyagi

Managing Director, DLF

Vivek Anand

Group Chief Financial Officer, DLF

Sriram Khattar

Vice Chairman and Managing

Aakash Ohri

Chief Business Officer and Joint

R. P. Punjani

09810655115/ punjani-rp@dlf.in

Amit Kumar Sinha

09810988710/ sinha-amit@dlf.in

Ashok Tyagi Whole

Time Director and Managing

Key numbers — 40 extracted

INR1,476 crore

ts for quarter 2 financial year '24 DLF Limited consolidated. The consolidated revenue stood at INR1,476 crores, gross margin at 57%, EBITDA stood at INR591 crores, reflecting year-on-year growth of 19%. Net

57%

'24 DLF Limited consolidated. The consolidated revenue stood at INR1,476 crores, gross margin at 57%, EBITDA stood at INR591 crores, reflecting year-on-year growth of 19%. Net profit at INR629 crore

INR591 crore

idated. The consolidated revenue stood at INR1,476 crores, gross margin at 57%, EBITDA stood at INR591 crores, reflecting year-on-year growth of 19%. Net profit at INR629 crores, reflecting year-on-year gro

19%

476 crores, gross margin at 57%, EBITDA stood at INR591 crores, reflecting year-on-year growth of 19%. Net profit at INR629 crores, reflecting year-on-year growth of 29%. Record surplus cash generati

INR629 crore

argin at 57%, EBITDA stood at INR591 crores, reflecting year-on-year growth of 19%. Net profit at INR629 crores, reflecting year-on-year growth of 29%. Record surplus cash generation from operations at INR1,1

29%

ecting year-on-year growth of 19%. Net profit at INR629 crores, reflecting year-on-year growth of 29%. Record surplus cash generation from operations at INR1,147 crores. New sales bookings for the

INR1,147 crore

crores, reflecting year-on-year growth of 29%. Record surplus cash generation from operations at INR1,147 crores. New sales bookings for the quarter stood at INR2,228 crores, in line with our guidance. Our new

INR2,228 crore

cash generation from operations at INR1,147 crores. New sales bookings for the quarter stood at INR2,228 crores, in line with our guidance. Our new products and existing inventory continue to even strong cons

INR990 crore

esulting in record cash flow generation during the quarter. Consequently, post dividend payout of INR990 crores, we achieved a net cash position of INR142 crores at the end of the second quarter. We have, the

INR142 crore

quarter. Consequently, post dividend payout of INR990 crores, we achieved a net cash position of INR142 crores at the end of the second quarter. We have, therefore, delivered on our commitment to achieving a

INR1,069 crore

financial year '24 DLF Cyber City Developers Limited consolidated results. Rental income grew to INR1,069 crores, year-on-year growth 9%. Consolidated revenue of INR1,463 crores, reflecting a 7% year-on-year g

velopers Limited consolidated results. Rental income grew to INR1,069 crores, year-on-year growth 9%. Consolidated revenue of INR1,463 crores, reflecting a 7% year-on-year growth. EBITDA stood at IN

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Guidance — 20 items

Vivek Anand

opening

“New sales bookings for the quarter stood at INR2,228 crores, in line with our guidance.”

Vivek Anand

opening

“We expect construction of a large retail complex in Gurugram to start during the fiscal.”

Sriram Khattar

opening

“You are setting a standard for sustainability, excellence to which others may aspire.”

Aakash Ohri

“And thankfully, there is -- it's backed by not just speculation, it's backed by solid demand, and therefore, the new Super luxury product that we were talking about earlier also, where we have -- we've also mentioned about it in our guidance.”

Vivek Anand

“Second half, we expect to start giving possessions for a large part of our floors.”

Vivek Anand

“So that will increase our spending, plus the Arbour project pace is going to pick up in the second half.”

Vivek Anand

“So there will be a large part of outflow coming up in the second half.”

Vivek Anand

“And if you remember, the guidance I had given was upwards of INR3,000 crores on an annualized basis.”

Vivek Anand

“And we are confident that as we are able to mature our product -- projects, and we are able to give OC, right, we'll be able to generate free cash and that will be utilized to repay the debt.”

Sriram Khattar

“And last about a quarter or so, we are seeing the green shoots when they have now started planning for the next year and 2 years and started looking for space.”

Risks & concerns — 5 flagged

Is there a concern that prices go up too much and then that basically impacts affordability or that's not a concern for you right now?

— Saurabh Kumar

As far as concern is concerned, you're right now referring to the real estate thing for resi but tell me where the prices are not going up, whether it's eating out in our hotel or an air ticket or even a holiday.

— Aakash Ohri

And I dare say the impact of COVID is now behind us.

— Sriram Khattar

We have always maintained a guidance of INR12,000 crores - INR13,000 crores, and even in our last call, I had mentioned specifically that there is an upside risk to this number, which is which is what -- I mean I believe that now maybe the upside risk is slightly stronger.

— Ashok Kumar Tyagi

Nothing -- I don't see this as a volatile the kind of thing.

— Aakash Ohri

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Q&A — 9 exchanges

Sir congratulations, Team DLF for achieving this positive net cash after guiding for almost 7 years. So seems to be a similar quarter for you guys. So I had a few questions. So 1 is, on Camellias, Aakash, so 14 apartments for INR712 crores. So fair to say that the pricing has now gone to INR70,000 crores, INR75,000 crores, if I just kind of do some back calculation on this unit sales? So that's the first one. The second is on your cash flow. So our construction spends are still relatively low. Now as your construction spends kind of move to the -- and you have 30 million square feet under cons

Aakash Ohri

Okay. So thanks, Saurabh. So in Camellias, we are above the INR75,000, you're right, mark. And now, as you know, we've got the last few to go. But I'm sure you would have read the Economic Times article. So very happy for Gurgaon to have reached that INR100 crore mark for one apartment. And I think that is something that is obviously everybody is quite excited about. So yes, Camellias is upwards of the number that you mentioned. So what you actually mentioned was the previous pricing and then it's gone up further. It's closer to what was being reported. And the only difference being that we ha

Sure, Thank you. Two questions from my side. There would be about INR19,000 crores worth of launches in the next 6 months. And after which you're largely left to the pipeline of about INR23,000 -INR24,000 crores and it seems like about 1 year's worth of launches of the new base -- is there a thought process already to start planning for the next phase of launches, which should come by for FY '26 onwards? So that's question number one. The second one is on the office side. Your IT services tenants have actually been very stable. It's something that we've not seen from the peers set. So is there

Aakash Ohri

So the first question is, see, we plan for almost 3 years ahead. And based on which geography we are getting into and what we are doing. So that, as an exercise, we continue to do internally. So yes, visibility may be shown for maybe a year or 1.5 years, but we plan 3 years in advance of what we are intending to do. So have been able to answer that question. So, Kunal, I mean while we have -- we have sort of documented the pipeline or the year after. It's not that our planning process is sort of shutting down. So we will have a -- I mean, we have enough land bank, and we will have a constant s

Thank you so much, Congratulations on good numbers. My first question is on the DevCo's commercial portfolio, the DLF 5 and City Center. The GAVs there seem to have fallen on a quarter-on-quarter basis. Can you comment what's happened there?

Vivek Anand

GAVs have fallen. So honestly, the GAVs keep on getting adjusted basis, the rentals. So this time to be fair, on some of those assets, we have done a very thorough analysis of the of the rentals that have been -- that are not they're just today, but their rentals that those buildings have been earning for the last 6 or 7 years. And I think that is the reason why the GAVs may have been slightly adjusted. As you know, -- these numbers have no bearing on the balance sheet or -- on the balance sheet or P&L. Sir, I know I understand, 20% fall, which is what bothered. So just wondering... So maybe p

Sir, just on the Phase 5 side, you talked about pricing. We are getting closer to INR100,000 per square feet. When I just look at your Slide 10, like when -- where we are talking about 5 million square feet of luxury valued at about INR12,400 crores, I mean that's like 25,000 square feet. So does this number see a significant upward revision? Because I believe the bulk of this would be Phase 5.

Aakash Ohri

So what you are seeing is for a ready-to-move-in or ready apartments. And as far as valuation is concerned, definitely, you will see there is a tremendous upside there already. And as far as this is concerned, if you go back to what it was earlier on certain price points at launch, they were - - if I just go back 7 years, there was an ex-price. And today, that price is about 4x that value. So I wouldn't want to speculate on future values. But all I can say is there is a reasonably good upside to what you have just mentioned. Right now, as what Mr. Tyagi was saying, that -- when we come closer

Okay. So the Andheri project is on track, as we had mentioned last time. We -- in the slum rehab is making very good progress. I think of the first phase of 30-odd stores somebody have 27-28 stores are already ready. And we stay on track for a potential launch around, I'd say, definitely before June of '24. So that does look to be on track. And the first phase should be about 1 million square feet of launch, give or take. Tulsiwadi has been in a significant legal mess and it's just gone further deeper in that. We had made a bid for acquiring 100% of the shareholding of the company to the then

Management

First is to Mr. Khattar. So I think very good leasing quarter across the operations and the under construction portfolio. Just wanted to get a sense of that leasing, 3 lakh square feet each leased out in both SEZ, non-SEZ space. Where is the demand exactly coming from? Is it the existing tenants expanding? Or are we also seeing some new tenants, specifically in SEZ spaces as well?

Sriram Khattar

So I will start with the non-SEZ spaces. The demand is coming from new tenants and existing tenants. And as I have mentioned earlier in the earlier analyst calls also the majority of the demand continues to be from the so-called global capability centers, which find India a very compelling location to look at because of its strong digital backbone, high-quality, global quality, infrastructure and office spaces at a fraction of a cost, and very high-quality, young English-speaking skilled manpower. These -- they are expanding in the country, and I personally believe that in the next 4, 5 years,

A couple of questions. Firstly, on Privana. So is there a rethink on the product that we have there versus the mid-rise that we were envisaging?

Aakash Ohri

No. So product, not we think in that way, but there was -- already, there were a couple of towers of high-rise in Privana. So it was -- that's just been some more towers basically have been added as high rise to the mid-rise scheme. That's all. So this -- in the plan, there was already highrise is a mix of that with some mid-rise. But right now, there is -- I think it's just -- we've added more highlights to the scheme. So as we kind of -- we feel that the demand there is more. And then, of course, the way it's coming out, again, it's -- if I can call it an Arbour 2 because it's just -- it's t

So just had a few more. So 1 is your staff cost is down quarter-on-quarter. What explains that? I mean given the performance of the company. So that's first. The second is with Dwarka Expressway, we are now finally completing, sir. Is there are like a lot of investor inventory, whatever gets unlocked and that kind of comes to the market? And how does it interact with your New Gurgaon supply, if you have any thoughts about what archive Dwarka Express completion in Gurgaon? So that's the second one. And thirdly, Tyagi sir, you have kind of your sales guidance has gone from INR12,000 to INR13,000

Ashok Kumar Tyagi

I will answer your last question first before I defer to Vivek and Aakash on the balance piece so make in our card for the balance piece. We have always maintained a guidance of INR12,000 crores - INR13,000 crores, and even in our last call, I had mentioned specifically that there is an upside risk to this number, which is which is what -- I mean I believe that now maybe the upside risk is slightly stronger. So hence, I added the plus INR13,000 crores. But you won't not just into giving a sharper number than that. Staff cost,Saurabh. Our staff cost for the full year is expected to be somewhere

Thank you. There's not much that I can say after that Aakash's rousing speech. But honestly, I think this hitting at zero debt was a very important sort of. It's almost an emotional target for many of us over the last 8- 9 years, as you know, and we've taken a lot of steps in the last few years on this. So it's great that we finally hit there. I think this -- I mean, the future does foretell -- I mean feel of strong cash flows and strong launches, hopefully. The RentCo, I mean, is doing an exceptional, exceptional job in terms of its leasing pipeline, it's built out of new capex, it's certific

Management

Speaking time

Ashok Kumar Tyagi

Vivek Anand

Aakash Ohri

Moderator

Puneet Gulati

Saurabh Kumar

Sriram Khattar

Kunal Lakhan

Pritesh Sheth

Abhinav Sinha

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Opening remarks

Vivek Anand

Thank you. Good evening, and welcome to DLF Limited Quarter 2 Financial Year '24 Earnings Webcast. Thank you for joining us today. We are happy to announce that our business delivered a strong performance across parameters. I will start with the financial highlights for quarter 2 financial year '24 DLF Limited consolidated. The consolidated revenue stood at INR1,476 crores, gross margin at 57%, EBITDA stood at INR591 crores, reflecting year-on-year growth of 19%. Net profit at INR629 crores, reflecting year-on-year growth of 29%. Record surplus cash generation from operations at INR1,147 crores. New sales bookings for the quarter stood at INR2,228 crores, in line with our guidance. Our new products and existing inventory continue to even strong consumer interest. Our super luxury offerings, the Camellias and DLF 5 Gurgaon saw healthy demand during the quarter and continues to set new benchmarks, indicating strong demand for high-quality residential products backed by a strong brand. We

Sriram Khattar

Thanks, Vivek. It gives me a lot of pleasure to share with all of you that the U.S. Green Business Council at the annual expo recognized DCCDL and DLF as world leaders in sustainability. And I'll just read out parts of the felicitation that they did there. It says DLF has become the worldwide leader in both LEED zero certifications and LEED for existing buildings platinum-certified spaces, which are extraordinary achievements. It also goes on to say that as the largest public listed real estate company in India, your actions and leaderships are influential and inspirational. You are setting a standard for sustainability, excellence to which others may aspire. I am honoured to recognize you're creating a sustainable build environment in the Greenbuild International Conference and Expo. U.S. Green Business Council could not be prouder to work with a global partner like DLF, leading the transformation and LEED generation of the build environment across India and throughout the world. I th

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