New Delhi, Aug 12 (PTI) Realty major DLF today posted a 58 per cent fall in consolidated net profit to Rs 109.01 crore for the June quarter, while promoters are in advance stage of discussion to sell stake in its rental arm in a deal pegged at around Rs 13,000 crore.
Its net profit stood at Rs 261.85 crore in the year-ago period, the company said in a regulatory filing.
Total income, however, rose by 9 per cent to Rs 2,211.24 crore in the first quarter of this fiscal from Rs 2,025.58 crore in the corresponding period of the previous year.
The decline in net profit during the quarter under review was due to one-time extraordinary gain of Rs 329 crore in the corresponding three months from the sale of DT Cinemas to PVR group.
DLF said the promoters’ plan to sell their 40 per cent stake in rental arm DLF Cyber City Developers Ltd (DCCDL) “is in advanced stages of discussion”.
In March, DLF promoters K P Singh and family had entered into an exclusivity pact with Singapore’s sovereign wealth fund GIC for the stake sale.
In October 2015, DLF had announced that its promoters would sell their entire 40 per cent stake in DCCDL, which holds the bulk of the commercial assets of the group.
Sources had earlier said the deal is likely to be valued at around Rs 12,000-13,000 crore.
The promoters would invest a significant amount from this proposed transaction into DLF Ltd, which will use it for reduction of debt that has crossed Rs 25,000 crore.
On the property market, DLF said in a statement, “Despite growth in the economy, the demand for residential real estate continues to be soft. Implementation of RERA (the real estate law) and GST has continued to elongate the sales cycle. The company expects that sector would achieve normalcy over next 2-3 quarters.”
DLF expects the property market to recover soon with reduction in key policy rates by the RBI this month.
“The company shall have a healthy pipeline of finished inventory for sale in foreseeable future when the demand returns,” the statement said.
After the roll out of the Real Estate Regulatory Act in the June quarter, DLF said there was uncertainty in the market as each state followed a different time-table for adoption of the central law and framing of their rules.
“The introduction of GST, from July 1, also added to the uncertainty resulting in elongation of sales cycle. Back-end integration challenges continued as it was dependent upon the timing of the GST registrations of the vendors also. The company is fully compliant with GST regime,” DLF said.
This is published unedited from the PTI feed.