DLF Ltd. reported bookings of Rs 42.7 billion in H1 FY24, flat YoY due to absence of any major launches except for a plotted project in Panipat and luxury floors in DLF city.
However, we expect the pre-sales run-rate to recover, driven by the launch of high-rise projects in Sector 77, New Gurugram and DLF 5, Gurugram, coupled with a tower launch in ONE Midtown, Delhi and the of luxury floors in DLF city.
The combined gross development value potential of these projects is expected to reach ~Rs 120 billion (includes only the first phase of the GCR project) and is expected to garner a robust market response.
Although DLF’s planned launch of a luxury project in Chennai has been delayed by a quarter, the recently acquired project in the Western suburbs of Mumbai is poised to compensate for the sales shortfall.
Based on the indicative launch pipeline, we expect DLF to clock Rs 155 billion of pre-sales in FY24, up 3% YoY. Depending upon the timing of the launch, the Mumbai project can add Rs 10 billion to FY24 pre-sales.
We maintain ‘Neutral’ rating with an increased target price of Rs 650.