DLF re-enters Mumbai with care
₹400 crore for a 51% stake in the project, spanning 3-3.5 million sq ft (msf) saleable area. “Re-entry into the Mumbai market, which is a key region for real estate sales, is positive. Achieving incremental growth from a large base could have been difficult by focusing only on the National Capital Region (NCR)," Parikshit Kandpal, vice president, institutional research, HDFC Securities, said.
So, the Mumbai market opens up new growth avenues for the company, he added. The first phase of the project comprises a saleable area of 0.9 msf and is likely to be launched within 12 months, the DLF management said. The phase-wise launch will give DLF enough time to evaluate the dynamics of the Mumbai market in case it decides to be more aggressive.
Considering DLF’s past experience in Mumbai, this approach is understandable. In its earnings call, the DLF management explained that its slum rehabilitation project Tulsiwadi in Mumbai is still facing challenges. So, this time around, it plans to expedite the launch of the first phase and start sales, instead of waiting for the entire project to be developed.
This should aid cash flows. This is DLF’s second foray in Mumbai after 2005, according to a report by Kotak Institutional Equities on 24 July. “DLF has fully capitalized on improving demand trends in Gurugram, offering a wide array of products at different price points and regular intervals.
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