20-05-2025
Nomura maintains ‘Neutral' on DLF after strong Q4; Midtown JV boosts revenue recognition
Nomura has retained its 'Neutral' rating on DLF Ltd. with a target price of ₹700, following the company's robust Q4FY25 performance, driven by strong revenue recognition from its 'Independent Floors' and first-time contribution from the high-profile 'Midtown JV' project.
DLF posted a 36.3% year-on-year rise in net profit to ₹1,282.2 crore, while revenue jumped 46.5% to ₹3,127.6 crore. EBITDA also surged 29.7% YoY to ₹978.1 crore, though EBITDA margin declined to 31.3% from 35.3% a year earlier, reflecting changes in project mix. The company declared a dividend of ₹6 per share, up 20% YoY, in line with street expectations. Midtown JV drives upside; collections hit all-time high
Nomura said the topline beat was fueled by better-than-expected revenue recognition from DLF's residential segment, especially its Independent Floors product and the first-time contribution from the Midtown JV. The brokerage noted Q4 revenue, EBITDA, and PAT came in at ₹31 billion, ₹10 billion, and ₹13 billion respectively — up 47%, 30%, and 39% YoY.
Collections stood at ₹33 billion, marking a 54% YoY and 9% QoQ growth — the highest ever for a single quarter. This helped DLF maintain a net cash position of ₹6,800 crore, significantly strengthening its balance sheet. FY26 outlook stable with healthy launch pipeline
Management reiterated its medium-term launch pipeline at ₹739 billion, with FY26-specific guidance at ₹170–180 billion — unchanged from earlier forecasts. Nomura views this as a sign of operational stability, backed by strong cash flows and visibility across key geographies like Delhi-NCR.
The brokerage, however, maintained a neutral stance, suggesting that near-term positives are largely priced in. 'While execution is solid and cash flows strong, the stock valuation remains fair given current levels and sector positioning,' Nomura wrote.
Disclaimer: This article is based on the brokerage report by Nomura. It does not constitute investment advice. Investors are advised to consult their financial advisors before making any investment decisions.
