New Delhi: DLF on Friday reported its quarterly net profit more than doubled, as demand for homes revived in the country’s property market after being hit hard by an economic downturn.
Prices in India’s $50 billion property market have moved up by a third in some key cities from last year’s lows after a series of interest rate cuts and pent-up demand from a large urban middle class revived home sales.
The commercial property segment had also started showing early signs of improvement with leasing volumes going up, DLF’s vice chairman Rajiv Singh said after the results.
“With the Indian economy projected to grow at a higher pace, we expect the real estate sector to further strengthen which will inturn strengthen DLF’s growth across all segments,” he said in a statement.
India’s economy is expected to grow 8.5% in the fiscal year to next March, at a faster clip than an estimated 7.2% in the year to March 2010.
Investors are also waiting for a possible revival of a planned Singapore-listing of DLF’s property trust, which was expected to raise $1.5 billion but was put on hold in 2008 due to the global financial crisis.
But high debt and a possible rate increase are concerns for real estate firms including DLF.
The Reserve Bank of India has already raised its key policy interest rates twice this year in 25-basis-point increments as the economy and inflation picked up following the global economic crisis, and another rate hike is seen in July.
New Delhi-based DLF said consolidated net profit rose to Rs426 crore ($94 million) in its fourth quarter ended March from Rs159 crore a year ago.
Revenue rose an annual 59% to Rs2,146 crore
Ahead of the results, shares in DLF, valued at about $11 billion, closed 2.4% lower at Rs298.75 rupees in a Mumbai market that fell 1.6%.
DLF stock is down about 17% so far this year, underperforming a 2.6 percent drop in the broader market.