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DLF stock surges 6% as Q2 net profit more than doubles

Stocks
2 min Read Oct 28, 2024
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On October 28, shares of India's largest real estate firm, DLF, surged over 6% as the company posted a robust 121% year-on-year (YoY) rise in consolidated net profit, totalling ₹1,387 crores for Q2 FY24. The company's consolidated revenue also saw a significant jump, climbing 48% YoY to ₹2,181 crore. This strong performance has piqued the interest of share market investment enthusiasts, as DLF's stock performance continues to outpace the broader market indices.

Share market investment in DLF: Bullish calls and prospects

Morgan Stanley has maintained an equal-weight call on DLF with a target price of ₹910 per share. While the company's pre-sales for the quarter were below expectations due to regulatory delays, analysts remain optimistic. A key development drawing attention in the share market investment community is DLF's upcoming LUX5 project launch. 

Expected this quarter, LUX5 carries a gross margin of 70% and is anticipated to play a pivotal role in DLF's goal of achieving ₹17,000 crore in revenue for FY25. This high-margin project is likely to sustain the company's development margin above 40%, adding further value for shareholders.

Analysts have issued a 'buy' call on DLF with a higher target price of ₹1,081. Their positive outlook is rooted in DLF's strong balance sheet and expanding rental portfolio, positioning it as a key player in the ongoing sector consolidation. For share market investment stakeholders, DLF's limited inventory and its trajectory of new launches serve as indicators of a healthy future sales pipeline.

DLF's performance in the market: Outperforming the Nifty

At 10:45 am on October 28, DLF shares were trading at ₹827.25 on the National Stock Exchange, marking a 6% gain for the day. Year-to-date, the stock has risen by around 14%, slightly surpassing the Nifty's 12% returns. Over the past year, DLF's share price has appreciated by 50%, significantly outperforming Nifty's 28% gain during the same period, strengthening its appeal as a promising share market investment option.

Key takeaways

  • Impressive growth: DLF's 121% YoY increase in Q2 net profit and a 48% rise in revenue signal robust growth.

  • Future projects: The high-margin LUX5 project, expected this quarter, is set to drive substantial revenue in FY25.

Market performance: DLF has gained 50% in the last 12 months, outperforming the Nifty, making it an attractive share market investment for growth-focused investors.