DLF's debt rises by over 900 cr to Rs 22,520 cr

Company's net debt stood at Rs 22,520 crore as on Sep 30, from Rs 21,598 crore at the end of the April-June quarter

India's largest realty firm DLF's net debt has increased by Rs 922 crore during the quarter ended September to Rs 22,520 crore.

In an analyst presentation, DLF said that its net debt stood at Rs 22,520 crore as on September 30, from Rs 21,598 crore at the end of the April-June quarter.

Of the total net debt, the one attributable to its rental business (RentCo) was Rs 14,300 crore and the rest Rs 8,220 crore pertained to development arm (DevCo), it said.

Asked about the rise in net debt, DLF's group CFO Ashok Tyagi said it generally increases in the second quarter of every fiscal due to dividend payments.

The company yesterday reported 21% rise in consolidated net profit at Rs 131.50 crore for the quarter ended September mainly on lower expenses. Its net profit stood at Rs 109.06 crore in the year-ago period.

Income from operations fell by 7% to Rs 1,865.49 crore during July-September quarter of the ongoing fiscal from Rs 2,013.15 crore in the year ago period.

On operational front, DLF's net sales booking stood at Rs 1,610 crore in the first half of this fiscal against Rs 1,230 crore in the corresponding period of the previous year.

Leasing volumes stood at 0.13 million sq ft in the first half compared to 1.01 million sq ft in the year-ago period.

On future strategy, DLF said in the presentation that it would create a large rental business platform in partnership with large, long term, institutional investors.

In FY16, annuity income is expected to grow by 10% to Rs 2,400 crore.

Last month, the company's board decided that DLF promoters will sell their 40% stake in the company's rental arm DLF Cyber City Developers Ltd (DCCDL).

The proposed deal is estimated to be valued at around Rs 12,000 crore. Promoters would re-invest a significant part of the amount realised from the proposed sale in DLF Ltd, which in turn would utilise this fund to trim its debt that stood at more than Rs 22,520 crore as on September 30.

"Post the completion of the proposed transaction, DLF to continue to hold 60% equity interest in DCCDL on a fully diluted basis," the presentation said.

DLF has appointed JP Morgan and Morgan Stanley as merchant bankers for proposed sale. It has roped in Pricewaterhouse Coopers as tax consultant and Shardul Amarchand Mangaldas as law firm to help execute this deal.

The company has a rental portfolio of 30 million sq ft of area.