NEW DELHI (Reuters) - DLF Ltd, India's largest real-estate developer, has appointed investment banks J.P. Morgan and Morgan Stanley to advise it on a planned listing of Real Estate Investment Trusts and other efforts to raise cash.
The developer named the advisers in a presentation on its website, a day after it reported a fall in quarterly profit, hit by sluggish home sales in Asia's third-largest economy.
Cash-strapped DLF has 30 million square feet of leased offices and shopping malls and is on target to earn an annual 24 billion rupees ($387 million) in rent by end-March, it said.
DLF plans to list two REITs, one for offices and the other for shopping malls, with the first expected as early as the next fiscal year, which begins on April 1.
"(This) will enable the company not only to recycle capital for future capex for growth, (and to) reduce debt from DLF's balance sheet but also substantially increase ROE (return on equity)," DLF said in its presentation.
REITs are listed entities that mainly invest in income-producing real estate assets, with earnings distributed to shareholders. They generally get special tax treatment.
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The timing of DLF's listing, however, will depend on the outcome of a tussle over a historic penalty imposed on the company by the markets regulator.
Last year, DLF was barred from capital markets by the Securities and Exchange Board of India (SEBI) for failing to disclose key information at the time of the company's record-breaking 2007 market listing.
The Delhi-based developer, which had net debt of 203.4 billion rupees at end-December, has appealed against the SEBI order with India's Securities Appellate Tribunal.
The company is also planning to raise 36 billion rupees through commercial mortgage-backed securities "to improve the quality of debt", DLF said.
DLF reported late on Monday a 9 percent fall in its third quarter profit to 1.32 billion rupees. Income from operations fell 5 percent to 19.57 billion rupees.
The company is fighting against the country's antitrust watchdog, Competition Commision of India (CCI), which in 2011 levied a fine of 6.3 billion rupees on it for alleged anti-competitive practices when selling homes.
CCI ordered two fresh probes against the company last week for allegedly abusing its dominant position in the development and sale of residential units in Gurgaon, a city on the outskirts of the capital, New Delhi, and DLF's home turf.
($1 = 62.0806 rupees)
(Reporting by Aditi Shah in New Delhi; Editing by Clara Ferreira Marques and Prateek Chatterjee)