DLF plans to clear half of its debts by 2016
New Delhi- DLF, a leading real estate developer of India, has planned to reduce its debts by 50 percent over the next three years. It is likely to achieve this through sale of its non-core assets, fresh equity shares and improved cash flows.
Last week, the top executives of DLF had a meeting wherein they took suggestions from analysts and sketched out a plan which will be followed to reduce the debt to half of the current Rs 21,350 crore. By 2016, it may come down to around Rs 11,000 crore approximately.
DLF’s share price, which had been witnessing a downward trend, has sprung up by rising over 5 percent to close at Rs 261.45. The realty major is planning to dilute promoter stake by issuing fresh equity shares in April-June 2013 quarter helping the company to raise over Rs 2,000 crore. By this, the firm plans to meet the guidelines of the capital market regulator Securities and Exchange Board of India (SEBI), as per which minimum 25 percent public shareholding by June 2013.
DLF is also planning to raise another Rs 2,500 crore after selling of its hospitality chain Amanresorts along with a part of wind energy business in this quarter. Two months ago, the firm announced the sale of Amanresorts back to its founder Adrian Zecha for Rs 1,650 crore and last month, it announced the sale of part of its wind turbine business in Gujarat to Bharat Light & Power for Rs 282.3 crore.
Besides these two, according to sources, the realtor is also negotiating for sale of of its wind turbines in Rajasthan (34 MW), Tamil Nadu (33 MW) and Karnataka (11 MW).
Cutting its huge debt to focus better on real estate is the main reason behind the firm selling its non-core assets and businesses.
DLF has cut down its debt by Rs 1,870 crore during Oct-Dec 2012 by getting Rs 2,727 crore from Lodha Developers against the sale of 17-acre prime land in Mumbai. It has stated that it is expecting that the debt will come down at Rs 19,000 crore by the end of this fiscal.
DLF observed 10.23 percent rise in consolidated net profit at Rs 284.80 crore for the third quarter of this fiscal, compared to Rs 258.35 crore in the year-ago period.
But the income from operations sloped down to Rs 1,310.04 crore in the third quarter, compared to Rs 2,034.37 crore in the same period last fiscal.
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Amanresorts, cash flows, DLF, fresh equity shares, Market regulator Sebi, non-core assets, real estate developer of India, Realty News, Securities and Exchange Board of India, Wind energy
