Sluggish Sales may hit the turnaround plans of DLF
Observing the current scenario, it has come to our notice that possibly the DLF will face a turnaround after selling all the units which do not seem important to their business and by nearly meeting their debt reduction target. One thing which still remains a concern is the sluggish and feeble home sales by market value.
Among all the important sales, DLF Global Hospitality Ltd which happens to be a subsidiary made an agreement on share purchase with Aman Resorts. This was for the sale of its stake in the Silverlink Resorts. Since all the important sales have been completed, the real concern among the analysts are whether the home sales will really pick up its pace or not. If that happens, then the DLF will not be able to generate better opportunities for the flow of cash or maintain the level of lower debt.
Because of the lack of economic growth and higher costs of borrowing, the home sales in India have been significantly hurt. According to Sandipan Pal, one of the biggest challenges of the DLF would be to get all its sales on track execute all its projects so that there is a good inflow of cash compared to its present cash flow situation.
Source: Madhurima Nandy
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