Stake sale in Aman Resorts not very profitable for DLF
The bottom line of real estate developer DLF may not be significantly impacted by stake sale in Aman resorts. In the past one year, DLF’s stock has decreased by nearly 50% mainly because of company’s lacklustre operational and financial performance.
The demand in NCR is not very healthy due to subdued macro environment. The company witnessed a 45% quarter on quarter decrease in sales in the three months to September. DLF’s net debt (total debt less cash) stood at Rs 19,500 crore in September and the amount received from this stake sale –Rs 2,200 crore — is quite small.
Interest costs figure as a major expense in Profit and Loss statement of DLF and its EBIT (earnings before interest and tax) is only a little higher. Financial leverage (use of debt) continues to be a big worry for the real estate major and the continuous asset sale does not seem to help the organisation.
