DLF Limited – Building India
As per our estimate, the stock at CMP of 134 trading at P/E of 42.54, The Debt Equity ratio is 0.82 which indicates the company is operating with a rational level of debt and may not find difficulty to meet its obligations. The interest coverage ratio of the company is 1.54. The market cap of the company is Rs. 23349.31 crore.
DLF is one of the Top 500 Shares, identified by Dynamic Research based on technical and fundamental research.
DLF share price has touched a 52 week high of Rs.142.90 on 09-Oct-2015 and a 52 week low of Rs.72.35 on 12-Feb -2015.
FINANCIAL
On quarterly basis the company’s net revenue from operations reached to Rs.2335.56 crore in Q4FY16 compared to Rs. 1953.69 crore in Q4FY2015 an increase of 19.54%. The operating profit for the quarter stood at Rs 722.66 crore compared to Rs 565.41 crore same periods last year. Net profit for the quarter stood at Rs.132.39 crore compared to Rs. 171.62 crore, the decrease of net profit was on back of increase in tax paid.
For the year ended March 31, 2016 on DLF consolidated basis reported net profit of Rs. 549.39 crore compared to Rs.540.24 crore FY2015 registering growth of 1.69% YOY.
About the company
DLF is the country’s largest real estate company. DLF development business primarily focuses on the development and sale of residential real estate which include plotted developments, houses, villas and apartments of varying sizes and integrated townships, with a focus on the high end, luxury residential developments. The development business also consists of certain offices, SEZ and shopping complexes, including those that are integral to the residential developments they are attached to.
The Company has now primarily categorized its development business into 2 broad categories namely, Gurgaon DevCo and National DevCo.
The Company’s lease business involves leasing of its developed commercial and retail properties. One of the key objectives of its lease business is to achieve returns from investments in its portfolio properties within a targeted timeframe. Another key objective is to achieve high occupancy rates for the leased portfolio properties.
Conclusion:
Indian economy showed early signs of growth post various initiatives and reform measures undertaken by the Central Government.
The Company believes that public and private investment spending to drive the capex growth will be critical to India’s growth outlook. The Government has taken measures to boost spending by increasing the capex allocation towards infrastructure projects by reforms in the budget. The Government is also taking various initiatives to unlock stuck investments in the core and infrastructure projects, revive investments from the private sector by reforming policy environment, improving the ease of doing business and accelerating the project related approvals.
The Reserve Bank of India (RBI) has started to lower the interest rates as well as increase the liquidity in the economy by taking various initiatives. Impact of US interest rates on global capital flows will determine the pace of interest rate cuts.
The Government has taken measures to revive the economy by modifying FDI policies for various industries, pushing hard for infrastructure spending and towards creating smart cities.
Various reforms announced by the Government such as ‘Housing for all by 2022’, development of ‘Smart Cities’ and the proposed real estate regulatory bill are expected to benefit the sector over the medium and long-term. The Government expects that half of the population would be shifting to urban cities by 2050.
The approval to Real Estate Investment Trust (REITs) was also an extremely welcome step which should help revitalizing the office & retail business.
On the basis of above factors we recommend a buy in DLF Limited for long term with a target of Rs.180.
To get powerful Support and Resistance for your favorite stocks visit DLF share price history.
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