 "DLF")
Realty major DLF's rental arm DCCDL's net profit increased 43 per cent to Rs 1,429 crore in the last fiscal on better income from office and retail properties.
Its net profit stood at Rs 1,002 crore in 2021-22.
According to an investors' presentation, DCCDL's total income increased 19 per cent to Rs 5,419 crore during 2022-23 from Rs 4,533 crore a year ago.
DLF Cyber City Developers Ltd (DCCDL) is a joint venture firm between DLF and Singapore sovereign wealth fund GIC.
DLF has a nearly 67 per cent stake in the JV firm, while GIC has the remaining.
As per the presentation, DCCDL's rental asset portfolio, comprising office complexes and shopping malls, is currently at 39.6 million square feet, and out of that 90 per cent area is already leased to tenants (corporates and retailers).
The rental income of DCCDL from office space rose 13 per cent to Rs 3,232 crore during the last fiscal from Rs 2,869 crore in the year-ago period. Rentals from retail space increased 59 per cent to Rs 735 crore from Rs 461 crore.
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DLF's Managing Director (Rental Business) Sriram Khattar told investors that SEZ has become a little concern in the market because of the sunset clause.
"In our portfolio, our SEZ has maintained a vacancy of about 15 odd per cent. Whereas our vacancy in the non-SEZ portfolio has dropped to only 6 per cent. And which is, I think, a very healthy sign and the combined vacancy is about 10 per cent," he said.
Khattar said industry bodies like CII and Naredco have urged the government for necessary changes in SEZ Act and rules.
On the office market, DCCDL said that "occupancy levels remain steady; demand recovery remains slow due to macro headwinds".
"New developments attracting healthy demand; implementing asset enhancement strategies to upgrade existing portfolio. SEZs space take-up remains slow; and changes in the existing landscape may provide the required fillip," as per the presentation.
On the retail real estate segment, DCCDL said that a resilient domestic economy, improving economic outlook along with growth in per capita augurs well for the retail sector in India.
"Footfalls have stabilised; we expect steady growth in footfalls and consumption. Leveraging this opportunity by creating new retail destinations at multiple locations," it added.
Khattar said the company proposes to develop Mall of India, Gurugram, and the construction work is expected to start this fiscal.
That apart, he said, "...in the Vasant Kunj complex where we have 2 malls, The Promenade and The Emporio, the total size of these malls is about 8,00,000 square feet...And we have the potential FAR (Floor Area Ratio) to do another 5,00,000 square feet in that complex. And that's right in the centre of town".
Similarly, at DLF Avenue mall in Saket, the company can construct another 2,00,000 square feet of GLA (gross leasing area), he added.
DLF is India's largest realty firm in terms of market capitalisation. It has completed more than 153 real estate projects and developed an area in excess of 330 million square feet. The company has 215 million square feet of development potential across the residential and commercial segments.
DLF, the parent firm, is mainly into housing (development business), although it continues to hold some commercial assets. The commercial rental business is in DCCDL.
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