DLF Q1FY26 presentation: Sales bookings surge 78%, rental income up 15%

Introduction & Market Context

DLF Limited (NSE:DLF), one of India’s leading real estate developers, presented its Q1FY26 results on August 5, 2025, showcasing robust performance across both its development and annuity businesses. The company’s stock closed at Rs 777.40 on August 4, 2025, up 1.99% ahead of the results presentation, reflecting positive market sentiment.

Quarterly Performance Highlights

DLF reported exceptional growth in new sales bookings, which reached Rs 11,425 crore in Q1FY26, representing a substantial 78% year-on-year increase. This performance underscores the strong demand for the company’s residential offerings, particularly in the luxury and super-luxury segments.

As shown in the following quarterly highlights, the company maintained strong operational metrics across its portfolio:

The company’s collections stood at Rs 2,794 crore, while operating cash surplus reached Rs 1,420 crore. Profit after tax (PAT) grew by 19% year-on-year to Rs 766 crore, demonstrating the company’s ability to translate sales momentum into bottom-line growth.

DLF’s consolidated financial performance over recent years shows consistent improvement, as illustrated in the following chart:

Development Business Update

The development business continues to be a strong growth engine for DLF, with consistent sales performance and improving margins. The company has maintained steady sales bookings over the past few years, with a significant jump in Q1FY26:

Looking ahead, DLF has an extensive launch pipeline across various segments, with a total sales potential of Rs 114,500 crore spanning 37 million square feet (msf). The super-luxury and luxury segments form the core of this pipeline, accounting for nearly 97% of the total sales potential.

The company’s financial position in the development business remains robust, with significant surplus cash potential from launched products. As of June 30, 2025, DLF reported a cash balance of Rs 10,429 crore, including Rs 7,782 crore in RERA 70% accounts. With expected receivables and after accounting for pending costs, the surplus cash potential from launched products stands at an impressive Rs 46,500 crore.

Similarly, the gross margin potential remains strong at Rs 40,250 crore, comprising Rs 24,500 crore from sales completed until June 30, 2025, and Rs 15,750 crore from launched but unsold inventory.

Annuity Business Performance

DLF’s annuity business, primarily operated through DLF Cyber City Developers Limited (DCCDL), delivered steady growth with rental income increasing by 15% year-on-year to Rs 1,326 crore in Q1FY26. The business maintained healthy occupancy rates of 94% across its operational portfolio of 46.2 msf.

The annuity business demonstrated strong financial performance, with DCCDL’s EBITDA growing by 14% year-on-year to Rs 1,356 crore and PAT increasing by 26% to Rs 593 crore in Q1FY26.

The operational rental portfolio maintains high occupancy levels, with non-SEZ offices at 98%, SEZ offices at 87%, and retail at 98%. The weighted average rental rate across the portfolio stands at Rs 110 per square foot, with retail commanding premium rates of Rs 184 per square foot.

Financial Position and Outlook

DLF has significantly strengthened its financial position, achieving a net cash positive status of Rs 7,980 crore as of June 30, 2025. The company repaid debt of Rs 1,364 crore during the quarter, further improving its balance sheet.

Meanwhile, DCCDL’s net debt stood at Rs 17,287 crore, with the net debt-to-EBITDA ratio improving to 3.2x. The net debt to gross asset value (GAV) ratio remains conservative at 20%.

The company’s consolidated cash flow remains strong, with a net surplus of Rs 1,131 crore generated in Q1FY26, providing ample liquidity for future growth initiatives.

DLF’s growth strategy is supported by its high-quality land bank with a total development potential of 188 msf. The company has 26 msf of projects under execution and 25 msf in the launch pipeline, with a balance potential of 137 msf for future development.

With strong pre-leasing of new products, including DLF Downtown Chennai (99% occupied) and Atrium Place Gurugram (73% pre-leased), the company is well-positioned to continue its growth trajectory in both development and annuity businesses.

The combination of robust sales momentum, steady rental income growth, strong cash position, and extensive development pipeline provides DLF with a solid foundation for sustained performance in the coming quarters.

Full presentation:

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