Shares of DLF surged over 2 per cent in trade on Thursday ahead of the board meeting to review and consider various strategic and financial options to drive sustainable and long-term growth and development of rental business.
The scrip of the realty major ended flat at Rs 138.65 after touching an intraday high of Rs 141.40, up 2.09 per cent.
"The Audit Committee authorised by the Board of Directors will also discuss issues to resolve conflict of interest in the ownership of DLF Cyber City Developers Limited (DCCDL) with inter-se affiliated persons/entities," said realty firm in a filing to BSE.
The Board will also take a call on cutting stake in DLF rental business company by up to 50 per cent and in the process raise $1.5-2 billion from a trusted private equity investor or sovereign fund. This is crucial because this is DLF's game plan to cut its debt by almost 50 per cent.
The company currently has debt of Rs 20,000 crore and its rental business company earns Rs 2,000-2,500 crore per year.
"If one looks at DLF's balance sheet and the numbers that have been stacking up so far, it does not give a very encouraging picture. The new launches and existing inventory are overhangs for the stock but if one looks at the rental assets that DLF is talking about, it is a substantial component. If you look at the enterprise value that we have been reading in media reports, it is close to 30,000 odd crores, so the contribution in terms of deleveraging happening on that part on the promoter side would be a huge positive sentiment for the stock," said Mayuresh Joshi, Fund Manager, Angel Broking in an interview to ET Now.
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