A recent trend is seen that homebuyers are cancelling their bookings with DLF due to various reasons like change in jobs, place or they are looking for the most suitable, affordable housing scheme within their budget. Whatsoever be the reason, the real estate developers have to bear a loss for the situation. Big developers like DLF is also not far from the scenario and is facing crucial time in their business.
The real estate leader DLF’s investors are facing prompt concerns as the company observed an approximately 50% cancellations of the total sale in the first nine months of current fiscal year 2017. They bear a total cancellation of Rs.790Crore that reduced bookings to Rs.760Crore from the gross sales booked for Rs.1,550Crore in the first nine months of the current financial year. Out of which Rs.390Crore cancellations were in December quarter only.
Also, the sales were much lower than the cancellations of DLF projects in the first quarter. On 17 Feb, 2017 the DLF shares bombed to Rs.137.15 by 6.99% on National Stock Exchange.
DLF has given weak reports for the December quarter and situation is low also for the upcoming quarters. The net sales fall down by 29% to Rs. 2,178Crore and profit by 44% to Rs.98Crore. Also, negative cash flow resulted an increase in debt quarter by quarter. Gross debt hiked to Rs.27, 220Crore from Rs.1,000Crore from the previous quarter, in December end.
In India, none of the real estate developers report any of the cancellations. The company spokespersons couldn’t give satisfactory answers when the analysts inquired about the reasons behind the large number of cancellations. Although, the analysts realized the main reason could be dropping prices of property.