PremiumReal estate developer DLF Ltd saw stellar sales bookings in Q2FY23. With its H1FY23 sales coming in at around ₹4,100 crore, analysts expect the company to exceed its FY23 sales guidance of ₹8,000 crore.
For that, it is crucial for investors to keep a close tab on the company's upcoming launches. In the September quarter, DLF launched low-rise luxury homes in phase V and independent floors in New Gurugram and Panchkula. In the second half of the fiscal year, it plans to launch around 3.1 million square feet (msf), which has a sales potential of Rs3500 crore and 9.4msf in FY24. Note that the H2FY23 launches will include additional inventory release in Panchkula and a high-rise project in Gurugram.
Expectations are that these launches will give the company's sales a fillip. According to analysts at Nuvama Research, pre-sales trajectory and collections would be key stock catalysts.
Needless to say, the rising cost of home loans as interest rates inch upward, is important for investors in real estate stocks. In a call with the analysts, the DLF management said, so far the increase in interest rates has been in line with their expectations, and the company has not seen an adverse impact on demand. In fact, given the depreciation in the Indian rupee versus the US dollar, the company is planning to reach out to non-resident Indians (NRI) over the next few months. Note that DLF has exposure to ultra-luxury residential real estate segment, which has recently seen an uptick in sales aided by the NRI and high-net worth individuals communities.
Meanwhile, analysts at Motilal Oswal Financial Services are confident about the DLF's growth trajectory in residential and commercial business. That said, a large part of it seems already priced into its valuation. "Thus, the implied value of its land parcels remains the only key metric for a further upside in the stock," added the Motilal Oswal report.
In this calendar year so far, the DLF stock has declined by nearly 7%. In comparison, sector index Nifty Realty has seen a higher fall of around 14%.