DLF climbs to 52-week high as Q4 net profit jumps 40%; brokerages remain upbeat

Shares of realty major DLF rose 2.5 percent and scaled a 52-week high in early trade on May 15 as the company posted a stellar set of quarterly earnings after market hours Friday.

At 09.36 am, shares of DLF were trading at Rs 445.40 on the National Stock Exchange, up 2.17 percent from the previous close. The stock also scaled a 52-week high of Rs 446.70 intraday.

The company’s consolidated net profit for the quarter jumped 40 percent on year to Rs 569.60 crore, up from Rs 405.54 crore in the corresponding quarter last year. The growth in bottomline was spearheaded by robust new sales bookings of Rs 8,458 crore in the March quarter, reflecting a year-on-year rise of 210 percent.

“Cumulative new sales for the last fiscal stood at Rs 15,058 crore, record annual sales bookings,” the company stated in its exchange filing. DLF also recorded sales bookings of Rs 15,058 crore in FY23, the highest among listed entities.

The record sales booking for FY23 can be attributed to the company’s luxury housing project ‘The Arbour’ at Sector 63, Gurugram, launched during Q4. The project created headlines after being sold out during the pre-formal launch phase by clocking new sales bookings of over Rs 8,000 crore.

Building on the stellar sales bookings in FY23, the company has also chalked out a plan to launch projects worth Rs 19,710 crore for sale in FY24. The company intends to leverage the high demand for housing to accomplish sales bookings of approximately Rs 12,000 crore in the current fiscal year. The majority of the projects slated for launch in this period will focus on the housing segment in Delhi-NCR and Chennai.

Global research and broking firm JP Morgan is upbeat on the company’s record pre-sales in FY23. The firm believes that DLF has become a double engine business with positive outlooks for both its residential as well as office segments. The broking firm also highlighted that the company’s residential business is debt-free excluding lease rental discounting at it parent company, for the first time in 15 years. Factoring the positives, JP Morgan has raised its target price for the stock to Rs 510, retaining its ‘overweight’ rating.

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Another brokerage, CLSA, though positive on DLF, believes the company’s FY24 pre-sales guidance of Rs 12,000 crore looks conservative. Nonetheless, the firm raised its pre-sales estimate for the realty major for FY24/25 by 21 percent/14 percent factoring in the record numbers for FY23. CLSA has a ‘buy’ call for DLF, with a price target of Rs 540.

Motilal Oswal Financial Services also expects DLF to match its FY23 sales run-rate, driven by a strong launch pipeline across the luxury and value segment. On that account, the brokerage firm increased its FY24/25 pre-sales estimates by 70 percent/32 percent. MOFSL retained its ‘neutral’ rating for the stock, but raised its price target by 6 percent to Rs 440.

Nuvama Institutional Equities also shares a similar optimism for DLF as it believes the uptick in housing demand bodes well for the realty major. “We believe DLF’s launches and pre-sales trajectory along with collections would be a key stock catalyst,” the firm wrote in its report. Backed by that, Nuvama retained its ‘buy’ call for the stock, with a target price of Rs 550.

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