DLF Ltd, India's
largest real estate company, recently said it has no unsold inventories despite
slowdown in the property market as the company mostly sells flats before the
start of construction of projects.
DLF Group Executive Director Rajeev Talwar
said, '' "We have always followed the model where we sell the project
before we start construction and this approach ensures that we do not have an
inventory of flats"
DLF Ltd said the Rs.
17,645 crore mentioned in the books of accounts under head 'Inventories'
represents mainly cost of land and plots, construction & development
material.
He noted that there
is "absolutely no pile up" of unsold flats despite slowdown in the
property market.
Talwar, however, said
that the company has adopted the model of simultaneously constructing and
selling flats few months back in couple of its projects, including The Crest in
Gurgaon.
Under this model too,
the company does not hold on to an unsold inventory of flats, he explained.
"A project
typically takes around four years to execute so whatever we build each year,
will easily find buyers. To that extent, we are inventory proof" Mr.
Talwar said.
He said the
inventories mentioned in the firm's annual report for 2012-13 fiscal was towards
cost of land and plots, construction and development material and even stock of
food and beverages.
"The definition
of inventory is very different as far as DLF Ltd is concerned and it no way
represents any unsold flats because our model prevents any such pile up,"
Talwar said.
DLF Ltd had reported
38 % fall in the consolidated net profit at Rs 181.19 crore for the quarter
ended June 30 on higher expenses. The company had posted a net profit of Rs.
292.79 crore in the year-ago period.
However, income from
operations increased by 5 % to Rs. 2,314.08 crore in the first quarter of this
fiscal compared with Rs. 2,197.71 crore in the corresponding period of last
fiscal.
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