Promoter Plan to Unlock Value for DLF
ET Intelligence Group: The decision of DLF’s promoters to sell their 40% stake in the rental arm business, DLF CyberCityDevelopment(DCCDL),has potential to unlock value for the listed company DLF. But given the past track record, when the sale of the company’s some of the other assets dragged beyond expected time, a critical task will be to sell the stake at the earliest even if it has to compromise on the valuation. DLF promoters have demanded a valuation of ₹ 13,000 crore for the 40% stake. This works out to an enterprise value (EV) of ₹ 41,000 crore after considering the debt of around ₹ 8,500 crore. DCCDL’s annual rent income is over ₹ 2,500 crore. It means the rent yield (rent income divided by EV) for potential investors will be 6%.