DLFNSEJanuary 27, 2025

DLF Limited

8,780words
116turns
11analyst exchanges
7executives
Management on call
Ashok Kumar Tyagi
Managing Director, DLF
Sriram Khattar
Vice Chairman and Managing
Aakash Ohri
Chief Business Officer and Joint
R. P. Punjani
09810655115/ punjani-rp@dlf.in
Nikita Rinwa
09069293544/ rinwa-nikita@dlf.in
Ashok Tyagi
MANAGING DIRECTOR – DLF LIMITED
Badal Bagri
GROUP CHIEF FINANCIAL OFFICER
Key numbers — 40 extracted
INR11,800
ahlias obviously was the prime highlight of the last quarter and I think we did a sales of almost INR11,800-plus crores. You must have seen the cash flows for the quarter are also extremely healthy at INR
INR 1,800 crore
,800-plus crores. You must have seen the cash flows for the quarter are also extremely healthy at INR 1,800 crores. In fact, we are now sitting on a total cash balance of almost INR 4,500 crores. The profit afte
INR 4,500 crore
remely healthy at INR 1,800 crores. In fact, we are now sitting on a total cash balance of almost INR 4,500 crores. The profit after tax for the quarter is at INR 1,000 crores, which again, after a long time we
INR 1,000 crore
ng on a total cash balance of almost INR 4,500 crores. The profit after tax for the quarter is at INR 1,000 crores, which again, after a long time we have hit the 4 digit category from an operation standpoint.
INR 900 crore
entation. You may also have seen the notes to account that we have also made a provision of about INR 900 crores towards discharging certain tax liabilities under ‘Vivad Se Vishwas’. These pertains to the old
INR 2,000 crore
ncertainty around that. And hence, we have moved in to do that. This will extinguish in excess of INR 2,000 crores of our contingent liabilities in our books as well. Before I hand over to Sriram to speak abou
7.2%
t like to touch upon the vacancy level in offices and retail. Our vacancies now have come down to 7.2%, which in offices, which at the beginning of the year were at 9% and the 7.2%, the vacancies in o
9%
acancies now have come down to 7.2%, which in offices, which at the beginning of the year were at 9% and the 7.2%, the vacancies in our non-SEZ portfolio are down to about 2% now whereas the vacancy
2%
ing of the year were at 9% and the 7.2%, the vacancies in our non-SEZ portfolio are down to about 2% now whereas the vacancy in the SEZ portfolio hovers around 12% - 12.5%. We are working quite hard
12%
non-SEZ portfolio are down to about 2% now whereas the vacancy in the SEZ portfolio hovers around 12% - 12.5%. We are working quite hard in Q4 to see how we can bring it down to around 6% - 6.2%. R
12.5%
Z portfolio are down to about 2% now whereas the vacancy in the SEZ portfolio hovers around 12% - 12.5%. We are working quite hard in Q4 to see how we can bring it down to around 6% - 6.2%. Retail va
6%
ers around 12% - 12.5%. We are working quite hard in Q4 to see how we can bring it down to around 6% - 6.2%. Retail vacancy continues to be around 2% in the portfolio, which is really a function of
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Guidance — 20 items
Sriram Khattar
opening
“So you, please, have to pardon me if the figures are not that very accurate to start with, but I promise you by the next quarter these will be completely fine-tuned as the overall rental business.”
Sriram Khattar
opening
“We expect the OC to come in this quarter.”
Sriram Khattar
opening
“Tenant handovers have commenced and the 2.1 million tower is now fully leased, other than 60,000 - 65,000 square feet, which we hope to complete within the next 2 months.”
Sriram Khattar
opening
“We expect the OC anytime now, and the rental also to commence in about 4 to 5 months' time.”
Sriram Khattar
opening
“2 million should get completed by early next quarter.”
Sriram Khattar
opening
“And Phase 2, which is 1.1 million, will be about 10 to 12 months after that.”
Sriram Khattar
opening
“And by 30th June, we plan to convert the entire portfolio to LEED Zero waste.”
Sriram Khattar
opening
“And sometime in the coming quarter or the quarter after that, we will make an announcement on when we believe we will be completely carbon- neutral.”
Praveen Choudhary
qa
“So if you can update us a little bit on the Gurgaon market, whether it matters to you for your Dahlias project or not, but in general.”
Praveen Choudhary
qa
“Just wanted to understand, again, in terms of long-term target for that asset, will you monetize it?”
Q&A — 11 exchanges
Q
Thank you so much for taking my call and Congratulations for a phenomenal presales quarter. I have 2 questions. The first question is related to the demand situation in Gurgaon. There has been a lot of market data points suggesting that there might be some over-exuberance in the last 12 months. So if you can update us a little bit on the Gurgaon market, whether it matters to you for your Dahlias project or not, but in general. And the second question was related to the investment property. It seems like there are a lot of completions going to happen. Just wanted to understand, again, in terms
Ashok Tyagi
Aakash on the demand, please Okay. So as far as the demand is concerned, I feel that the markets in Gurgaon are now maturing and Gurgaon is no more a geography related purchase story anymore. It's agnostic to investments that are coming into Gurgaon are from all over the world, and of course, all over the country. So, what is happening today, I will speak for DLF first, where a DLF product is now almost akin like right now what people are doing is, it's something, which has been compared to what people generally like investing in stocks and the market and all. So, a DLF product that way with t
Q
Yes. Am I audible?
Ashok Tyagi
Yes Pritesh. Yes. So, congrats on great performance. First, I am just trying to understand the mix of demand that we've got in Dahlias. How much is incumbent population from NCR, India, NRI, whatever insights you can provide us because these numbers are like beyond our expectations. So just trying to understand where that's come from. Yes. Pritesh, So it's the Golf Links community, first, in that order I'm going. Then NCR, then NRIs and then rest of the country. NRIs have contributed to about 12% of our sales in Dahlias. About 50% has been the community, friends and family and people who live
Q
Yes, Hi sir, Congratulations on a great set of numbers. Sir, I've got 2 questions, one is for Sriram. Sriram, on DCCDL, if you look at it, your debt-to-EBITDA has been consistently coming down, whereas your rentals have gone up. Like it's now down from 5.6 to 3.2 - 3.3. Now you've got almost 12 million square feet coming up for expansion. So do you think the same trajectory will continue or there can be some changes there?
Sriram Khattar
Well, I think the trajectory will, by and large, continue but we have started discussing with the shareholders that having come to a figure of between 3 - 3.5 should we go down further or should we look at using the cash generation for future expansion. I think that is still in the melting pot, and we are working on what to do further. We realized that just reducing debt for the sake of reducing debt is not a good idea, especially for an annuity company, and we are sort of focusing on it. Do we have a ready answer? Not yet, but in the next few months, we will. Thanks Sriram, Tyagi ji, I've got
Q
Hi and congrats to the whole team on strong set of numbers. Sir, just quickly on the pipeline on Figure 7. Sorry, Slide No.7, launch calendar. So, this year, we now have Mumbai to come and Privana Phase 3 is next year, right?
Ashok Tyagi
So, Abhinav, that 3 projects, Goa, Mumbai and Privana Phase 3 are all under the approval process. Our current reading of it is that it looks that the Mumbai approval should come hopefully in the next few weeks, and we should be able to launch it. And the other 2 could overflow into the next quarter. But again, while we have to report on a quarterly basis, this is not unfortunately a business, which is executed on a quarterly basis. So, our three projects are under the approval cycle and we are hopeful at least one of them should be able to make it to the finishing line within this quarter. And
Q
Am I audible now?
Management
Q
Thanks for taking my question and congratulations for a great performance in Dahlias. So, a couple of questions from my side. Tyagi sir said that we expect 2 out of 3 projects maybe to spill over to FY '26. I think he had also mentioned that we'll probably see the launch of the project on the IREO land that we had bought in FY '26. So apart from these 3 projects, what could be the potential launch pipeline that we can see in FY '26?
Ashok Tyagi
Parvez, bhai see, we have a tradition that we speak about the pipeline for the fiscal year in the annual accounts closing call which we do in May. So let that tradition stay right now. But I think you are, I mean, look, the good news is that courtesy and transparency on the sales pipeline, all of you know the projects that we are working on, be it Sector 61, the IREO land, be it a couple of other projects in DLF City, be it the next phase of Privana, the next grounds in Chandigarh, Mumbai. So, I think, clearly, some of these will eventually fold in into FY'25, FY‘26 fiscal. But I’d that we are
Q
Yes, sure. Hi, Congratulations, everybody, on the fantastic results. I just wanted a few clarity on the cost of construction. It goes a long way that, for example, if you're selling Dahlias, let's say, INR 80,000 a square foot and if you're selling Privana, let's say, INR 20,000 a square foot, there would be some value addition in terms of costs that you would be incurring higher on the Dahlias project. It will go a long way for the customer to understand and the analyst to understand as to what the component or the percentage of cost of construction is to the sale value of the asset. And if t
Ashok Tyagi
Okay. So, Samir frankly, I don't have an answer for the last part of your question as to why is our costs higher except a factual acceptance that, yes, our cost is higher. I think that's it. So if you see -- if you check out our filings on the Privana piece, I think our construction cost is ballpark in the range of INR 8,000-odd a square foot, INR 8,500 on a sale price of about INR 20,000, which broadly is a 40% ratio. In Dahlias, frankly, we are expecting a construction cost to be in the range of ballpark 25% to 28% to 30% of our total sale price because the construction cost -- and in all fa
Q
Okay. Great. Yes, Thank you so much. My first question is, first of all, congratulations on Dahlias, extremely well done. On Dahlias, to start with, have you offered everything, the entire 420 units, to customers? Or was only a certain part of the inventory initially offered and more will be opened up later?
Aakash Ohri
No. So thanks. Dahlias, as far as the inventory is concerned, most of it was offered. Some basically higher floors and they have different price points. And therefore, they come in different phases. But anybody who's wanting to pick up anything at a future price point is more than welcome. But right now, I mean we did not hold back on inventory. We let people choose, and the price points were according to what they chose. And of course, every, I repeat, every apartment in Dahlias is differently priced from the other. Understood. That's helpful. Secondly, on the office portfolio DCCDL, there wa
Q
Yes. Am I audible?
Ashok Tyagi
Yes Sir. Hi Good evening everyone. So my first question was on your residual portfolio. If you look at DLF 5, there is still additional area of about 20 million square feet-odd. And I think last quarter, you had mentioned about that, going forward, DLF 5 would be, say, Camellias plus or like similar to Dahlias kind of a vision you have for the rest of the portfolio. In that context, how should we look at the monetization timeline? And how would you bring this product to the market? And what is the timeline for this? So, in all fairness, I think as Aakash mentioned earlier in the call, Dahlias
Q
Sorry to interrupt, I would like to make one clarification. I think Parvez asked a question of FY '26 rentals and I told him in DLF, the rentals will be INR 1,000 to INR 1,200. I would stand corrected, they are INR 800. INR1,000 to INR1,200 was for the following year. And therefore, I erred on that. My apologies sir.
Management
Q
Thank you so much. And I think, today, we truly had a very, very engaging call. And hopefully, we continue to stay focused on the path that we have chosen. And I'd just like to have a sort of a moderating tone, which is that while obviously, we are all very buoyed by the Dahlias sales. I think the metric that should truly excite us is not the INR 11,800 crores of the presales, but the fact that INR 8,000-plus crores of free margin has been booked on account of the Dahlias sales because I do believe that, at some stage, the industry and the analysts following the industry have to come out of th
Management
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Speaking time
Ashok Tyagi
37
Moderator
15
Sriram Khattar
14
Puneet Gulati
8
Pritesh Sheth
6
Aakash Ohri
6
Aakash Ohri
5
Abhinav Sinha
5
Samir Jasuja
5
Parvez Qazi
4
Opening remarks
Ashok Tyagi
Thank you. Good afternoon, everybody. Welcome to the DLF Limited Q3 Analyst Call. As you must have seen the presentation by now, we've had a pretty solid quarter last quarter on both the development and the rental businesses. I mean, Dahlias obviously was the prime highlight of the last quarter and I think we did a sales of almost INR11,800-plus crores. You must have seen the cash flows for the quarter are also extremely healthy at INR 1,800 crores. In fact, we are now sitting on a total cash balance of almost INR 4,500 crores. The profit after tax for the quarter is at INR 1,000 crores, which again, after a long time we have hit the 4 digit category from an operation standpoint. We had promised a series of metrics over the last 2 to 3 years that we'll be doing. And I think you'd be glad to know that we are, by and large, achieving most of them, be it on sales, PAT, cash flow, margins and on the rental business. And we hope that we continue to sustain this in the quarters to come. You
Sriram Khattar
Thank you, Ashok. So this is the first time we are changing the format slightly, where after Ashok gives the opening statement I'll spend a little time on the rental businesses. And this has happened because when we speak of rental businesses, the first thing that comes to our mind is DCCDL, the subsidiary that is there along with GIC. But as we see the future and as we see now, the rental income on the DLF balance sheet also is continuing to increase and therefore, we will talk a little about the rental business in totality. And so it will be DCCDL plus, plus. So you, please, have to pardon me if the figures are not that very accurate to start with, but I promise you by the next quarter these will be completely fine-tuned as the overall rental business. I'll first like to touch upon the vacancy level in offices and retail. Our vacancies now have come down to 7.2%, which in offices, which at the beginning of the year were at 9% and the 7.2%, the vacancies in our non-SEZ portfolio are d
Sriram Khattar
Which was in the 2 malls in the Delhi NCR were a little delayed because of the GRAP and the stoppage of construction. But otherwise, we are on complete track on that. The construction on Atrium Place is moving on track. Atrium Place, as you know, is a joint venture with DLF Holdings 2/3 equity and Hines U.S. holding 1/3 equity. 2 million should get completed by early next quarter. And Phase 2, which is 1.1 million, will be about 10 to 12 months after that. Our SEZ, the total stock that we had, which was vacant was 2.3 million square feet, out of which we have applied for 2.2 million square feet for de-notification. 1.9 million of that has been approved by the Board of Approvals and out of this 1.9 million, 1 million has already been leased. On sustainability, we continue on our path to be the global leaders. We, as you know, have achieved LEED Platinum for all our operating buildings. We have got LEED Platinum Zero for water discharge for all our buildings, both are sort of leaders glo
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