Technically, for DLF (CMP:107), strong positional support is 99 & it has to sustain over 109 for an immediate to short term target of 120-126 & 133-140-150. In the mid term, consecutive closing over 150, it may target 166-180 zone. Sustain over 166, it may scale 205-220 in the long term in bullish case scenario.
For DLF, 100-109 may be proved to be a good demand (support) zone for the time being.
On the downside, consecutive closing below 95, it may fall to 80-75-60 & 50-39-30-20-6 in the near to long term under worst bear case scenario.
Bottom Line: Technical Trading Levels (Positional)
| SL</>2 | FROM SLR | |||||||||
| DLF | CMP | 107 | ||||||||
| T1 | T2 | T3 | T4 | T5 | T6 | T7 | SLR | |||
| Strong > | 100 | 109 | 120-126 | 133-140 | 150* | 166 | 175-180* | 205 | <95 | |
| Weak < | 95 | 80 | 75 | 60 | 50 | 39 | 30-20 | 6 | >100 |
Q4 result of DLF is well below street expectations amid slower sales and high interest outgo to service its massive debt burden of around Rs.21000 cr.
It is an irony that the Indian property market went through a bull run in the last decade or so, with prices in most major cities are sky-rocketing, but fortunes of some of the large property developer such as DLF, Unitech etc are worst at the same time.
For DLF, whose scrip was around Rs.1000 in early 2008, now is near Rs.100 in 2015. Some economic slow down may be attributable to its revenue de-growth, but largely DLF has itself to blame for its troubles. One of the reason might be DLF's irresponsible borrowings to foray into various capital-intensive expansion & diversification into both core and non-core assets back in 2007-08 and later exiting them at considerable loss. Subsequently, DLF has ballooning debt, revenues fall, profits shrink and cash flows dry up. It has reached an alarming level for its ability to service its debt and adding to its woes, there are various looming or ongoing regulatory and also political hurdles.
But there are some bright points also as its leasing portfolio is continuously doing well. It has sizeable land banks & various projects in hand. The company is undergoing various feasible routes/options to raise funds for its cash-flow problems (like leasing projects through PE route, PVR may acquire its DT cinemas etc).
Going ahead, various regulatory challenges, weak demand environment (specially in its key NCR/Gurgaon MARKETS), high debt & negative operating cash flows will be headache for the company. But, infrastructure push/smart cities theme, demand for office/commercial spaces, REIT(s), passage of land bills, outcome of various ongoing legal issues/huge fines may be some of the triggers of the company. The management is itself guiding till H2/FY-16 for a visible improvement of its performance.
As par quick BG metrics, current median valuation of DLF may be around 132 & its projected valuations may be around 175-225 (FY:16-17), based on current market scenario.
| SCRIP | EPS(TTM) | BV(Act) | P/E(AVG) | LONG TERM | SHORT TERM | MEDIAN VALUE | 200-DEMA | 10-DEMA |
| DLF | 5.28 | 93.4 | 25 | 140.45 | 123.45 | 131.95 | 149.45 | 115.45 |
| DLF | 8.98 | 102.3 | 25 | 183.17 | 160.99 | 172.08 | 149.45 | 115.45 |
| DLF | 15.25 | 112 | 25 | 238.70 | 209.80 | 224.25 | 149.45 | 115.45 |
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