DLF Q1 profit rises 4% despite sharp fall in revenue on weak project completions
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Real estate developer DLF Ltd . reported a 4.1% year-on-year rise in consolidated net profit for the June quarter, even as revenue more than halved due to lower project completions during the period.
The company's net profit rose to ₹793.9 crore in the first quarter of FY27 from ₹762.7 crore a year earlier. Revenue from operations, however, declined 52.9% to ₹1,280.3 crore from ₹2,716.7 crore in the corresponding quarter last year.
Operating performance weakens
Operating performance remained under pressure during the quarter. EBITDA declined 58.7% year-on-year to ₹150.3 crore from ₹364.2 crore in the year-ago period, while EBITDA margin narrowed to 11.7% from 13.4%, reflecting lower operating leverage amid a sharp fall in revenue.
The margin contraction was largely driven by a sharp fall in revenue recognition following deferred project launches, which reduced operating leverage during the quarter even as the company maintained confidence in its upcoming launch pipeline.
Despite the softer operating performance, the company managed to post higher bottom-line growth, aided by contributions from associates and joint ventures as well as other income.
"The sustained demand environment, coupled with our strong execution capabilities, enabled us to deliver healthy operational performance during the quarter. We remain focused on timely execution of our development pipeline while maintaining financial discipline," chairman Rajiv Singh said.
Housing demand remains resilient
DLF said the underlying demand for premium and luxury housing continues to remain healthy despite a high base and evolving macroeconomic conditions.
"The company continues to witness healthy demand across its residential portfolio, supported by strong customer confidence and a differentiated product offering. The balance sheet remains robust, providing flexibility to pursue future growth opportunities," the management said.
The company has been focusing on accelerating construction across key projects while expanding its annuity business through DLF Cyber City Developers Ltd. (DCCDL), which continues to provide stable rental income from its commercial office and retail portfolio.
Focus on execution
DLF said it remains committed to strengthening its development pipeline while maintaining a prudent capital allocation strategy. The company added that it continues to focus on timely delivery of ongoing residential projects and expanding its rental portfolio through high-quality commercial assets.
The management reiterated that the company's healthy balance sheet and strong cash generation position it well to capitalise on opportunities across residential and commercial real estate markets, while continuing to create long-term value for stakeholders.
Shares of DLF ended Monday's session 1.40% higher at ₹668.55 apiece on the NSE. Despite the day's gains, the stock has declined nearly 15% over the past year, underperforming the Nifty Next 50 index, which has gained over 12% during the same period.