ICRA upgrades credit rating of DLF Limited to ICRA AA- with Stable outlook; Stock jumps over 3%

The rating upgrade reflects DLF Limited's robust sales and collections in HIFY22, the company said.

November 30, 2021 10:15 IST | India Infoline News Service
DLF Limited — India's leading real estate company, announced that it has received a ratings upgrade from the country's premier rating agency ICRA to AA- with Stable Outlook. This follows the recent rating upgrade done by another premier rating agency CRISIL in August. The long term rating has been upgraded to CRISIL AA- /Stable.

The rating on Non-Convertible Debentures Rs1,000cr has been upgraded to ICRA AA- (Stable); from ICRA A+ (Positive). For Commercial Paper Rs1,000cr the rating was upgraded to ICRA A1+ from ICRA A1.

The credit rating agency also upgraded the rating on Fund based - Term Loan Rs1,790.0cr to ICRA AA- (Stable); from ICRA A+ (Positive). On Fund-based - Working Capital Facilities Rs2,078cr ICRA AA- (Stable) rating was upgraded from ICRA A+ (Positive).

On Non-fund based - Working Capital Facilities/Bank Guarantee Rs850cr ICRA AA- (Stable) rating was upgraded from ICRA A+ (Positive).

At around 10.18 am, DLF Ltd was trading at Rs387.20 per piece up by Rs12.35 or 3.29% from its previous closing of Rs374.85 per piece on the BSE.

“The rating upgrade reflects DLF Limited's robust sales and collections in HIFY22, despite the lockdowns and disruptions created by the Covid-19 pandemic, which enabled the company in reducing the net debt significantly and improving the cash flow adequacy ratio to multi-year high levels. Additionally, the company continues to see healthy demand in its super luxury housing project - Camellias (Gurgaon, Haryana), and the newly launched independent floors projects in Gurgaon, Haryana,” company said in a filing on Monday.

It further said, the ratings upgrade demonstrates the strong business fundamentals of the Company and reflects the underlying improvement in the operating performance. Some key points cited for the upgrade include:
  • Strong sales momentum from new product launches across Gurugram
  • Consistent reduction in net debt with improved collections and surplus cashflows
  • Prime land parcels in marquee locations which are at historical costs and are fully paid
  • Steady monetisation of completed inventory across the country
New product pipeline of 35 msf across geographies and segments will enable scaling up and consequently ensure steady cash flows over the following years. The company additionally draws further strength from its large rental portfolio which continues to deliver resilient performance and is now witnessing renewed demand.

“These rating upgrades from ICRA & CRISIL demonstrate the strength of the DLF brand and its strong business fundamentals. We continue to remain focussed on scaling up our new product launches, new sales bookings and collections. These upgrades will allow us to further strengthen our access to capital and improve our debt profile in the near term,” said Vivek Anand, Group Chief Financial Officer, DLF Ltd.

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The average score for Prestige Estates Projects Limited stands at 4 against 6, three months back.

Prestige Estates Projects Limited is engaged in the business of real estate development. The Company’s principal products/services include Development and construction



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