CRISIL Ratings Limited has reaffirmed its long-term and short-term ratings for DLF Bank facilities

DLF Limited Ratings and Financial Overview

CRISIL Ratings

CRISIL Ratings has rated DLF Limited's non-convertible debentures (NCD) as 'CRISIL AA/Stable' and reaffirmed its bank facilities as 'CRISIL AA/Stable/CRISIL A1+'.

DLF's Grade

DLF's grade reflects high sales bookings and increased cashflows due to robust demand, fresh launches, strong market position, and execution track record. Despite planned debt increases for strategic acquisitions, the company's financial risk profile will remain sound, supported by significant financial flexibility.

Financial Performance

In Q3FY2024, the company had its greatest quarterly sales of 9,047 crore . This was due to the successful launch of its premium project, Privana, which sold out within days, resulting in revenues of ~7200 crore. In the first nine months of fiscal 2024, receipts were Rs 6,449 crore, up from Rs 5,650 crore in the full year 2023. The collections are projected to continue healthy in the medium future.

Sales and Receivables

• Healthy sales have resulted in committed receivables of around Rs. 19,000 crore as of December 2023.
• A launch pipeline of approximately 10 million square feet (msf) in FY2025 would boost cash flows and fund construction costs during the project's lifespan.

Debt Profile

The company's gross debt fell to Rs 2,948 crore in December 2023, from Rs 3,068 crore in March 2023. The company's strategic acquisition initiatives are likely to lead to higher debt levels by the end of fiscal 2024, surpassing CRISIL's prior predictions. The financial risk profile will moderate, with an increase in total debt to assets by the end of fiscal 2024. However, this is likely to recover by fiscal 2025. The corporation aims to reduce debt in the medium future. Any divergence from the debt reduction plan, as well as any significant debt-funded acquisitions, will be closely monitored.

Balance Sheet

As of December 31, 2023, DLF's development business has a cash and bank balance of Rs 4,194 crore, with the majority earmarked for project development in RERA accounts, and committed receivables of Rs 19,000 crore, against a pending construction outflow of Rs 9,757 crore.

Cash Flow

DLF's cash flow is backed by dividend income from DLF Cyber City Developers Ltd (rated 'CRISIL AA/Positive' and a joint venture with GIC, with DLF owning two-thirds of DCCDL), the group's rental arm.

About CRISIL Ratings

CRISIL Ratings contains ratings for over 25,400 major and mid-sized corporations and financial institutions. Their skills include the full spectrum of debt products. Also assist issuers and borrowers enhance their access to credit while also lowering their funding costs. For investors and lenders,  it helps in augment internal assessment procedures by benchmarking credit quality across investment opportunities. CRISIL Ratings improve market functioning and help regulators measure and manage systemic credit risks. These ratings are used to calculate capital adequacy in the banking industry and to identify the acceptable investment pool for insurance companies, pension funds, and provident funds. CRISIL Ratings have also graded or evaluated over 110,000 Micro, Small, and Medium Enterprises (MSMEs) in India.