The country’s top real estate player, DLF Ltd, registered a 77 per cent drop in its net profit during the quarter ended September, as demand for real estate continued to be sluggish compared to last year.
The company registered a profit of Rs 439.7 crore during the quarter, compared with Rs 1,934.1 crore during the comparable quarter last year, shows the consolidated results announced by the company today. Sales (and other receipts) during the quarter also dipped 53 per cent to Rs 1,751 crore.
Other real estate companies also saw similar dips in sales and profits. Housing Development & Infrastructure Ltd (HDIL) posted a 44 per cent dip in net profit to Rs 148.6 crore, while Sobha Developers’ net profit was down 38.2 per cent to Rs 27.5 crore during the quarter.
Analysts said they were expecting such dips in the numbers, given the fact that the September quarter of last year was considered good for many real estate companies. “The first half of FY2009 was good for many real estate firms. Only from next quarter onwards does it make sense to compare on y-o-y perspective,’’ said Sastha Gudalore, analyst with Alchemy Shares & Stock Brokers.
Companies, though, are seeing a revival in demand. Rajiv Singh, vice chairman, DLF Ltd, said: “As the demand has recovered, sales in homes have picked up considerably. Keeping in line with this pickup in demand, we will continue to launch a mix of attractive products across locations.” The company also intends to sell noncore assets. “We remain committed to deleveraging the balance sheet and actions on sale of non-core assets are currently underway,” Singh said.
“Sales started picking up from June and we are seeing a 20-25 per cent rise in demand for our upcoming projects,” said a official from Sobha. The company will also start withdrawing the discounts it was offering for its residential projects, he said.