Ladies and gentlemen, good day, and Welcome to DLF Limited's Q1 FY 2025 Earnings Conference Call. We have with us today on the call Mr. Ashok Tyagi, Managing Director and CFO, DLF Limited; Mr. Sriram Khattar, Vice Chairman and MD, Rental Business; Mr. Akash Ohri, Joint Managing Director and Chief Business Officer. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. I now hand the conference over to Mr. Ashok Tyagi. Thank you, and over to you, Mr. Tyagi.
Thank you, and good afternoon, everybody. You know, I hope that all of you have had a good, you know, opportunity to go through our analyst presentation and our result details. In all fairness, it was a good quarter. Our pre-sales number was in the range of INR 6,400 crore, predominantly headlined by the extremely successful launch of Privana West. You know, our PAT numbers, obviously, given that they are on the complete contract method, and, you know, are driven by the possession that is issued, were again, you know, good at INR 646 crore.
And I think the most heartening number that really, you know, everybody should draw a lot of enthusiasm from, is the entire cash flow number, where really, if you see between our DLF and Cyber City numbers, together, we did in excess of INR 2,500 crore of free operating cash flow during the quarter. And that actually does, that does paint itself to have extremely formidable run rate of free cash flow going forward. I mean, the Devco business continues to run very strongly because of the strong pre-sales. And I mean, there are these big tentpole launches that happen, and which Akash and his team do a phenomenal job of taking to the market, and there are those maintenance sales which continue.
Our collections performance has been continued to go from strength to strength, which has resulted in the cash flows, you know, being strong as well. And all of this has been, you know, supported extremely strongly by a continued robustness in the rental business, both on offices and malls. And frankly, our faith in the rental business is even more reinforced by the quantum of CapEx that we are doing on the rental side, both in DLF Cyber City as well on the non-DLF Cyber City CapEx. So frankly, with that, you know, really I would, I think I rest myself and then, let's go to questions. I mean, the budget obviously was a very interesting budget.
There has been a lot of noise around indexation, but really, you know, once the noise is sort of filtered out, I don't think it has too much of a bearing on the way the sales behavior will be. So I think with that, I'd hand you over for the question queue.
Sir, should we start with the Q&A?
Yes, ma'am.
Thank you very much, sir. We will now begin the question and answer session. To ask a question, please click on the Raise Hand icon tab available on your toolbar or on the Q&A tab available on your screen. You may also post your text questions on the Ask a Question tab available on your screen. Kindly turn on your mic when the operator announces your name. For participants joining through the audio bridge, to ask a question, you may press star and one on your touchtone phone. If you wish to withdraw yourself from the question queue, you may press star and two. Participants are requested to use only handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from Puneet Gulati, from HSBC. Please go ahead.
Yeah, thank you so much, and congratulations on, you know, great numbers, all round improvements. Very happy to see that. My first question is on, you know, the margin side. If I were to take out the other income, which was higher, if you can comment on that as well. And excluding the other income, the margins were, you know, a little weak. What all products have gone into that margin recognition? If you can give some color, it'll be very useful.
So in all fairness, Puneet, as you're aware, that the reported numbers and the reported margins are based on the possessions issued for a product mix that was sold-
Right.
between 3-5 years back. As the proportion of Camellias, say, Camellias possessions starts reducing, and I think now they are just about, I think, 30-35 Camellias left for giving possessions now. You know, you will see at times some of the slight softening, and obviously it will be buoyed at times by luxury floors coming in for completion, et cetera. So I wouldn't sort of, you know, put too much attention on the historical reported margins. Our embedded margins for new products launched continue in the late thirties, and hopefully with the launch of Lux 5 during the later part of this year, we should be back to the mid-forties that we have charted ourselves for.
As far as the other revenue is concerned, I think clearly, with us now carrying a cash balance of about INR 5,000 crore in RERA accounts alone, and about INR 2,000 crore in addition to that, our quarterly interest earnings on fixed deposits, both mandatorily and otherwise, is now running at in excess of INR 125 crore a quarter. Then in this particular quarter, there were some other interest incomes, including one from an income tax refund that was ordered in the case of DLF Limited, the tax department. And there was-
What was the number?
Excuse me?
What was that number? Sorry.
The number of the income tax refund?
Yeah.
I think that the total income tax refund ordered is about INR 600 crore or INR 550 crore, and I think the interest component of it is in the range of INR 80 crore-INR 90 crore.
Okay.
The third point was that there was a provision that we had made for an advance that we had issued, that we had given for a collaboration about 15 years back. There was a fallout between the landowner and us, and it was all in arbitration. Because of which, at one stage, about five or six years back, we had made a provision of about INR 75 crore. We have got finally an arbitral award in our favor, and though the arbitral award is, in all fairness, at a number far higher than the provision reversed, but since it's open for, you know, further adjudication, all we have done is we have reversed the provision that was made about five years back, of about INR 75-odd crore.
So I think those are the three points that are there on the other income side. And of course, there, there's a standard recurring other income because some of the incomes of our clubs and all also frankly get classified as other income. So that's the ongoing piece. But yeah, this quarter, the other income is a slightly higher number than what it normally is.
Understood. That's, that's very helpful. Thank you so much. And secondly, if you can talk a bit about the construction cost, right? While your collections have moved up, construction costs on a quarter-over-quarter basis is actually a little low. Should we assume that this is how it will trend, or is there room for it to meaningfully go up from current levels in the current fiscal year itself?
No, no. This will go up for sure. And the reason right now is that if you see the launches, I mean, the high-rise launches that we have done in the last 15 months, so, Arbour was launched in March of 2023. Privana South was launched in December of 2024, and Privana West in December of 2023, and Privana West in April of 2024. Only Arbour has, you know, acquired serious construction phase right now. Privana South, contracts and all have been awarded, the contractors have mobilized, execution's commenced. Privana West, that process should begin in the next couple of months. So really what you'd see is, that maybe in about a couple of quarters, you would actually see construction hitting full throttle.
Okay. What would that number look like?
I think our construction on an ongoing basis-
INR 800 crore.
Yeah. We believe that, on a full throttle basis from Q3, the construction outflow on the Devco side should be a number north of INR 800 crore.
Okay. That's helpful, very helpful. And lastly, you've also increased the, you know, launch guidance in some sense. What are the new projects that you've added there?
So at least for this, Puneet, there are no new projects. What's happened is that, I think clearly we were understating the pricing expectations from Lux 5, and I think we have rationalized them now. So I think by and large, this INR 5,000 core-INR 6,000 crore, that's been the increase from last quarter to this quarter, is predominantly driven by a more realistic price expectation on Lux 5. The pricing expectations on the Privana family, on Mumbai, on Goa, broadly remain the same that they were in the last quarter.
And also the 11.6 million sq ft has also gone to 12.8 million sq ft, so some bit of new projects-
That I think is a true-up as the final plans of some of these projects have frozen.
Understood. That's very helpful. Thank you so much, and all the best.
Thank you, sir.
Thank you. We'll take the next question from the line of Parvez. I'm sorry, Parvez has left the queue. We'll take the next question from the line of Pritesh Sheth from Motilal Oswal. Please go ahead, Pritesh.
Yeah, hi. Thanks for taking my question. So just first question on, you know, a little bit of noise of late, which was created in Gurgaon about, you know, little slower sales in INR 7 crore plus or a little higher ticket size category. You know, obviously, not for you guys, but, you know, for some other competitors. So just wanted, you know, your thoughts on, you know, are you seeing, at least some exhaustion in terms of price increase, you know, at certain price point? There would be a certain section of, you know, customers who are right now probably moving away, from the absorption. So just your thoughts on that.
Obviously, we haven't seen that slowdown in our case, but I'll really hand over to Akash, who knows this market inside out.
Okay, so, see, we've done in about 15 months, as you all know, we've done about close to INR 22,000 crore of sales. And which includes, Arbour, which includes both the Privanas that you saw. They hover around $1 million each, each unit, you know? So right now, as I see it, the demand is further consolidating, also towards, a better and a good product.
I say this extremely humbled with the fact that the kind of response that DLF gets today is. I strongly believe is because of all the work that we have done on ground, which includes not only of the product, but working on the image and geography and on the infra that we are known to do. So I think the endorsement, Pritesh, is of what we see and the kind of response that we are seeing. Very important for you all to know that our bookings are around. We don't do the INR 5 lakh-INR 10 lakh booking, as you know. We charge an INR 50 lakh rupee booking amount for, so these. First of all, the most of the people who come in with this kind of a money are very serious.
Second, also happy to report to you, to your point, that the, even after we sell out, within one month, there is the process of these agreements that are signed. That further solidifies the sale, because then you are practically, you know, the customer is signing on that 10% agreement. Happy to report to all of you that even after that, should there be any discomfort in customers, and there have been, like, 20-odd in the most recent Privana West, I can report to you, have all been reinstated with an additional increased cost. So the, the process right now as we go along is, of course, how we are going about the whole business and the demand, the latent demand that a DLF product still has, and, and our delivery schedule, and our commitment.
So I feel based on all of that, our price points stay where they are. Also, Mr. Tyagi had made a mention yesterday also, that if you have, if you have seen our collections have been on an all-time high. They've been record collections this quarter as well. And you please track us down for the last six quarters, you will see what I mean. So therefore, this is a strong endorsement of a DLF brand and of a DLF product. I don't see any slowdown at this point in time. I am being very honest with you. And I don't see anything right now, because right now, as we play, we play the whole world together.
Any launch is a global launch for us, whether it's the NRIs, domestic or other cities in the country. We are seeing very robust demand. We are seeing extremely good customers with good paying capacity and a very, very good eclectic mix of people coming and buying these products. So, that's it from me.
You know, another thing, Pritesh, because this is a normally, you know, a noise level of investor versus, versus, you know, real so-called residents. That actually, in the sales that Akash and his team have done in the last 2.5-3 years, the proportion of retrades that have come in the market is minuscule. So it's not that people who are buying are exiting in a hurry by making that, you know, the INR 50 lakh profit or something. They're all here to stay for, for at least the medium term, if not in a 100% case, the long term. So that erstwhile speculator market continues to be, you know, away from all of these launches.
And also, to add to you, Mr. Tyagi, in nine months of time, after every launch, you're almost talking about 35%-40% of the cost of the thing. So we do—we are not, we don't promote speculators to that point, you know?
Yeah, sure.
Sure. That's, that's helpful. Just, you know, just a follow-up on that, I mean, while we remain confident on demand, you know, would you be equally confident on, price increases as well? If at all you want to take, let's say, in Privana, where we have, like, we have had a very couple of successful, phases. So, you know, are you seeing some kind of exhaustion there, or still there is scope of, you know, prices going up, depending upon the quality of the product that, we are going to launch next?
No, exhaustion, if you're saying... Again, I don't work in one geography, Pritesh. So, for me, as I said to you again, I repeat, the whole world is one playing field for me. When I launch, I do a global launch, so it is not restricting me to one NCR geography. My customers today are coming from all over. I have a very strong NRI pipeline, as we reported in our closure of last year. We have a 25% top line. So please understand, for us, when we launch a product, for us, our outreach is all over. You know, so, you know, plus, again, I reiterate the fact that people are today endorsing a DLF brand, and they're endorsing a good DLF product. So...
I see, let me put it another way to you, that these are only what? How many? The next launch will have another maybe 800- 1,000 people. That's all. You're looking at it from the overall number of INR 8,000-10,000 crore. I look at it from the point of view, units. So for me, 800 units is to source, say, about maybe 1.5x-2x the people all over the world.
Yeah.
I'm sure somebody is doing well at that point in time, who's going to be affording this particular thing, and that's about our principles, and that's how we've been operating.
Absolutely. That's, that's pretty helpful. Second, and on, you know, the cash allocation, from here on. So last year we have had, like, couple of, big transactions, one in Mumbai, one in Gurgaon. You know, will, will we have a plan of at least signing up, like, you know, couple of projects in a year, considering the kind of cash flows that we are generating? Or, we would just be opportunistic in terms of, you know, investing into these newer projects, if it makes sense from margin profitability perspective.
So, I mean, while we have broadly always indicated that we would like, on a medium-term basis, to allocate our free cash flow to-
... growth and shareholder returns on broadly a 50/50 basis. But I think, you know, it'll depend year to year. There is no set, you know, I'd say, target that we have to acquire 10 million sq ft of GAV or something, because frankly, we have enough, enough GAV of our own. But clearly, like we did in Sector 61 or Mumbai, if there's an interesting opportunity that crops by, which is available at the right cost, and in a market which is either underserved or contiguous to the market we are, you know, we'll always be open to it. But, frankly, you know, it's not that that we are aggressively pursuing any inorganic opportunities as of now.
Sure. Just one last for Sriram Sir. You know, on the SEZ leasing, I mean, it has almost remained flatish in the last probably couple of quarters, I would say 85%-86%. How do you see the trajectory going ahead? You know, let's say by end of the year, what kind of leasing targets you have internally for the SEZ portfolio specifically?
Yeah. So, our SEZ portfolio, before the de-notification started, was, in the DLF system, including DCCDL, 16.5 million. Out of which we de-notified, about 15%, about 10%, about 1.6 million. This has now, I think 70%-80% leased out, and I think as we go forward in the next 3-4 quarters, the leasing momentum will pick up further because of two reasons: One, the Ministry of Commerce and the development commissioners of the SEZs in the various states are now getting to the process of de-notification, which in the first one or two rounds was a little tedious, as people did not know, as the officials did not know what stance to take and how to go about it. Now, that process is settling down.
That is number one. Number two, if you take Gurgaon, the vacancy in Cyber City, non-SEZ, which is about 13 million sq ft, is only 2-3% now. So any new inquiry that comes in, is shown the likely vacancies to be coming up in SEZs or the existing vacancies for them to take up. So I am cautiously optimistic that in the next 3-4 quarters, this will show a lot of traction.
Sure. That's helpful.
I may also share that the rental rates for the non-SEZ or the non-processing declared areas are slightly better than the rates that we get on SEZs.
Sure. But no specific targets on leasing, as of now, right? I mean, it would be as and when it comes.
We have year-end targets. Our vacancy today in offices is about 8.8 %. We plan to take it down to overall between 6% and 7%.
Sure, got it. That's helpful. Thank you. That's it from my side, and all the best.
Thank you. We'll take the next text question from Parvez Qazi, from Nuvama Group, and the question is: What are the completion timelines for DT Gurgaon Block 4 of 2 MSF and DT Chennai Block 3 of 1.77 MSF?
Okay. I'll take that question. Downtown 4, Gurgaon, the OC is expected by the end of this year. However, after the OC comes, there is a fair amount of other development, landscaping, and other work to be done. We think this building will complete in all its ramifications by February, March next year. Downtown 3 in Chennai, we expect the OC to come in end August, early September, most likely September, and by the time the landscaping and the other things are completed, it should be by the end of this year. However, our handover to tenants will start once the OCs come, and for both the projects, we expect the rental incomes to start flowing in from May next year.
Thank you, sir. We'll take the next question from the line of Praveen Choudhary from Morgan Stanley. Please go ahead.
Hi, thank you so much for taking my call. I have two simple questions. One is the launch timelines for some of the projects that you are expecting in the second half festive season, especially Mumbai project. Also in the Mumbai project, we saw last quarter in your presentation, it was in the premium segment, and now I find it in the either super luxury segment or luxury segment. So was there any change in expectation of ASP there? And my final question is related to a question that you might have got earlier about Gurgaon market. The ASP increase is quoted very high in different media and different reports by JLL, et cetera. I just want to understand if such kind of ASP increase is visible, would it attract-...
Speculators, even though I agree that last two years you may not have seen, but are you seeing in the last three to six months? Thank you.
Okay. I'll address the launch sales pipeline piece, and then refer to Akash for the average selling price increase question. So our launch sale, launch base, launch pipeline remains what we had indicated earlier, which is that hopefully, if all approvals come in time, we should have the Goa launch in this quarter, before September end. And we should have the Lux 5 launch in the next quarter. Mumbai, you know, right now, the approval process is on, along with the requisite, you know, clearance, et cetera. The first slum we have building of about 35-odd stories is ready now. And I think the shifting of the erstwhile, you know, tenement dwellers will begin.
So we are expecting that again to hopefully get launched by December, maybe overflow to January, but I think December is the target right now. Q4 should see one more launch of the Privana family. Whether it's in the Privana landscape or adjoining one, I think is open to discussion, but clearly one more Privana-like product should hit the market in Q4. In addition to this, there will be small launches of Chandigarh and a couple of commercial launches.
So with regard to your ASF and in attracting the investors, I think we mentioned in the previous conversation also, that for us, our intent has been to look at retail customers. Our intent has to has been over the last two years, we have deduped our list.
Even if somebody is asking for two units, mostly, we say no. Our intent is to spread our base, to as far as we can, so that we can seek that, end customer, and that is how we have been going about our business. So as far as investors are concerned and speculators are concerned, there are two things: one, that our price point entry barrier itself is very high. So, that is the first level. Second, should we see somebody repeatedly, trading or not retaining their properties, we generally, you know, put them last in our priority. So the allocation process also, as it goes, you know, should we find, any amiss, and our, our checks and balances, are on a monthly basis because these are linked to our collections.
So therefore, any time collections flags off a name or an occurrence which is other than what it should be, you know, the systems then kick in and identify those problems and then get in. So that is how we have put our checks and balances. So therefore, speculators, to a large extent, you know, I don't think we would attract them, or even for them, it's not going to be easy. So I think for us, we want to play it absolutely, you know, safe and low down. I feel that for us, it takes a lot of effort to reach to that end customer, and we are happy to do that.
Our systems are geared up to do that, and that is what we do on a daily basis. So we mine irrespective of the launch or a product, we continue to mine every day for a new customer, and our various categories and various price points are open, and therefore we keep putting them in various buckets. As and when we launch and we know what category they are and what level of investments they want to make, and as and when we launch post our approvals, then we reach out to these sets of people who we have continued to mine, as I said earlier, and then that's how we operate. So I hope, Praveen, if that has answered your question.
Yeah, that's very clear. Thank you so much, and congratulations for good collection, good operating cash flow, as well as strong pre-sales.
Thank you.
Thank you. The next question is from Kunal Lakhan, from CLSA. Please go ahead.
Yeah, hi, good evening. Firstly, you know, you've rationalized the pricing in your new launches. Does that make any changes to your full year guidance and for your pre-sales of INR 17,000 crore?
So right now we are not officially re-guiding you to a higher number, but I think it's a logical, you know, conclusion that that there should hopefully be some upward bias to that. Maybe, you know, wait one more quarter by the end of next quarter, you know, we should be far closer to our actual launches. And hopefully, I mean, again, as we had mentioned last time, the INR 17,000 crore number basically still budgets in about a 90%+ sale level on all other launches and a small introductory sale level on Lux 5. And hopefully, that's where possibly the upside could come in. I think, you know, hopefully by the time we are again, you know, talking to each other in October, we'll really have a completely good number of this.
Also, just to follow up-
Akash? No, I would-
Sorry.
Yeah, I'm just adding to what Mr. Tyagi just mentioned, Kunal, about there's also a very strong second market that we monitor, and happy to report two transactions in the second market in the last one week. One of Grove, which is in the DLF 5 geography, which has crossed INR 30,000 a sq ft. Recently, just today an hour back, we closed a Crest 4,000 sq ft unit at INR 49,500. It touched INR 50,000 a sq ft, Crest.
... So, you know, again, no matter what we say, obviously you can take with a pinch of salt, but please, if you monitor the kind of work that is happening on ground in terms of the second and third sales, you will understand where the, where these price points and where these customers- These are all, they're not speculators. They're people who are buying for themselves or their family, you know? So therefore, you, the valuations that you will see obviously will have to reflect the facts on the ground.
Yeah. Understood. Understood. And the fact that you said that, you know, that, you know, all the—excluding Lux 5, you know, the rest of the launches, you're expecting at least 90% to be sold out. I mean, that clearly puts you northwards of that INR 17,000 crore numbers, so.
We hope so.
Yeah. As on the collection side, right, you know, your collections, say, excluding Privana launch, right, should be around, say, about, you know, INR 2,500 crore now. Would that be an accurate number?
Excluding Privana, how much was it? Excluding Privana, Privana West. Yeah, so you're right. It will be about INR 2,500-INR 2,600 crore, excluding the Privana West. You're right.
And that number should also-
Kuldeep can give you the more details offline, so I don't have the numbers-
Correct.
Available.
It will be, it will be about INR 2,700 crore-INR 2,800 crore, because-
INR 2,700 crore, INR 2,800 crore.
Yeah. So you take out the Privana, recent Privana West-
Yeah.
About 800-odd, you know, units, so yeah.
Sure, sure. So this number should also inch up, considering your, you know, last year's sales number, and then, you know, Privana also contributing from, let's say, next quarter onwards, right? This number should see a significant jump?
So no, I think now, frankly, the numbers are, you know, they are reflecting the regular installments of both-
Mm.
Arbour and Privana South. The Privana West installments will start coming in now from maybe Q3 onwards. But the fact is that, you know, in the first six months, you collect about 35%, so there is a significant upward collection. That also then eventually aligns itself with the construction milestones, et cetera. So I think the number will stay in the INR 3,000-odd crore range. Again, the new launches could occasionally provide a bubble, but ballpark, this INR 2,900 crore-INR 3,000 crore is, I think, what our quarterly collections for the next two quarters at least should stay at.
Sure, sure. Just to follow up on that, you know, Arbour would have been now, like, you know, it's been, it must have been at least a year and a half since Arbour's launch.
15 months, yeah.
15 months, yeah. So how much would you have, we have collected in that project by now?
Almost 45%.
45%.
45% .
Yeah.
Okay, so like, 15 months, 45%.
Yeah.
Okay, understood. My last one is on a bookkeeping question, actually. You know, we used to have this surplus cash potential slide, you know, until last quarter, which is not there in this quarter. If you can give some details from that slide, you know, in terms of balance, cost of construction.
Okay, okay.
As well as-
Yeah, yeah.
Yeah.
In all fairness, I'll give you. I mean, we had the data Kuldeep will give you. We just thought that data, in all fairness, you know, Kunal, was a legacy of the cash crunch time when you wanted to convince analysts, and more importantly, convince yourself that you will have the money to complete the projects. I think really, with the RERA now being at scale, that risk no longer exists. But you are right, we have that number. And I'll give you off the cuff. Ballpark, our receivables of the projects that we have launched till thirtieth June is about INR 21,000 crore have to be collected. We have about INR 10,500 crore-INR 11,000 crore is our total cost to complete.
Of that INR 11,000 crore, INR 5,000 crore is already residing in the RERA account today. So basically, of the INR 21,000 crore collection that is to come, about INR 6,000 odd crore will need to be, to, to be spent more on construction, and the balance really would be margin. In addition to all of this, we have about INR 3,000 crore of ready inventory, which, including a few Camellias, which obviously will also be 100%, you know, sales, sales realization. So we have that slide.
Sure.
We just didn't put it here.
Yeah.
We'll restore it if on popular demand, if you want, from next quarter.
Yeah, that will help. And also the CapEx on DLF as well as DCCDL balance?
Okay, so Sriram?
On DCCDL, this year's CapEx will be INR 85 crore-INR 100 crore. Going forward, in the next 2-3 years, this will go up by about 18%-20% from this ballpark figure of INR 2,000 crore.
Okay. On standalone, that number was about INR 700 crore, balance CapEx, that would be slightly lower now, I'm assuming.
On the stand-alone [Foreign language]?
DLF, DLF.
As in DLF.
Oh, DLF. Yeah, yeah.
DLF.
Yeah, yes. So, the residual CapEx on the three malls that DLF is constructing is about INR 600 crore, ballpark?
INR 700 crore.
INR 700 crore, INR 700 crore. And the residual CapEx on The Atrium Place, which is a JV with Hines, is again about INR 700-odd crore.
Yes.
Yeah.
Understood. Thank you so much, and all the very best.
Thank you.
Thank you. The next question is from Abhinav Sinha, from Jefferies. Please go ahead.
Hi, Khattar sir, on DCCDL, maybe I missed this, but, what is the driver of the jump in rentals this quarter? And, what is the exit run rate we are looking at?
So the jump in rental is a combination of two things. One, the accrual that comes on an annual basis-
...And the other is the start of the rentals in Downtown 1 and 2 in Chennai. The exit for this, which we had given the guidance earlier, is INR 5,000 crore. But next year, the jump up will be rather significant because Downtown 4 and 3, Downtown 4 in Gurgaon, Downtown 3 in Chennai, and the full rentals of Downtown 1 and 2 will come into play. And therefore, this will go up significantly in FY 2026.
Okay, so north of INR 60 billion, INR 6,000 crore next year?
So, my sense is it will be, while I cannot officially say, it will be about INR 5,800 crore-INR 6,000 crore.
Okay, very helpful. Sir, on the DLF Mall plus atrium that we are constructing, can you give us some similar guidance? Because, you know, some of these are nearing completion also.
Yeah, sure. So, Atrium Place is a, as you know, a joint venture with Hines, where, DLF owns, 2/3 equity. We, the total, which we are building there is 2.9 million. The, OC of... There are three blocks of about 650,000 each, and one block of 850,000. The first three blocks, the OCs will come between January, February, and April next year. And Block 4, which is the bigger block, it will come in October next year. The rentals next year will be in the ballpark of INR 240 crore-250 crore. Though, when, all the four blocks are completed, on a steady state, the rental will be about, INR 580 crore-INR 600 crore.
I may also share that we've started leasing that, and we've already leased about 400,000 sq ft. That is one area of focus in the current year to ensure that we continue to lease the buildings at least 80%-90% before we get the OCs.
Similarly for the malls also?
So there are three malls that are coming up. I will give you the details one by one. One is what we call the Midtown Plaza, which is the baby mall out of the three. It's about 200-odd sq ft. That gets completed end of this year, and the rental should start by April next year. The next one coming up will be Summit Plaza, where the rentals will start, say, in Q1, early Q2 of FY 2026. And the DLF Promenade in Goa, which is 700,000, that will get completed end of next year, and the rental of it will come in April 2027. April 2026.
Okay, sir.
My apologies.
April 26th. Okay. And this will total up to another, you know, you were saying roughly INR 250 crore-INR 300 crore. So, roughly.
Yeah, this is upward. This is INR 300 crore, yes.
When all these three are done. Okay.
Yeah. And this is about 1.3 million.
Any plans to sort of retain them or transfer to DCCDL? Any thought process there?
Yeah, [Foreign language], once they are in a final rent yielding mode, at that time, we'll talk to Mr. Khattar and GIC, and depending on how the two of them decide, we'll discuss.
Yeah, but, you know, having said that, at the excellence in maintaining the excellence of tenancies-
Yeah.
The excellence of operations is seamless between whether the asset is owned in the books of DLF or in DCCDL.
Right, sir. We know that pretty well. Tyagi sir, one last question from my side. On the IOPs, we are expecting a launch next year, right? I mean, is there anything outstanding legally or payment-wise, or it's just the process of planning?
So there are basically two major parcels. One is between 19.5 or 20 acres, one is 7 acres. The 20 acres was already a group housing license, so that the transfer of license process is going on. I think that should really be completed in the next, I mean, very short time. The balance 7 acres was a part of a plotted license, and there's a migration of license exercise. There's a certain protocol process in the government that's going on to convert it into a group housing license, and the two of them will be combined.
So I think by the time both of them are done, we expect it will be end, I mean, end of this calendar, definitely for sure, if not end of this fiscal, and hence the plan to launch it in the early part of next year. Yes, there will be some governmental charges, et cetera, that I think are due. But, you know, I mean, if you recall, the total cost that we had paid and committed for the entire 20 acres to the sellers was about INR 1,250 crore. And I think the all told, the approval, et cetera, for getting it to the requisite 3.5 FAR, is I think another INR 400 crore-INR 500 crore.
Some of it which has been expended, some of it will be expended across the next 3-4 quarters.
Okay. Thanks, and all the best to the team.
Thank you.
Thank you. The next question is from Puneet Gulati, from HSBC. Please go ahead.
Yeah, thanks for the follow-up opportunity. So the land acquisition payment of INR 413 crore this quarter, does that relate to the same IDO thing or some other land parcel?
Actually, it does not. So about INR 225 crore or INR 230 crore of it, actually, I mean, it was a question of how do you classify it? It is actually the TDR payments for the Privana TDR. You know, so what happens in TDR is that basically either you have surplus land, which right now we don't have-
... or you acquired those sort of licensable or those TDR-able lands in the market, and then send it to the government, the government gives you the TDR certificates. So this INR 230-odd crore is the land cost of those TDR certificates, and the balance INR 170-odd crore is some partner payment to our collaborators and some smaller land acquisitions for contiguity. But the big chunk here is TDR. I mean, just to sort of bring everybody up to speed, the total cost of TDR land plus approvals runs to about INR 1,800/sq ft-1,900/sq ft, which frankly, given the same prices of 20,000+, is a fraction. And the residential cost of residential TOD is actually under INR 1,000/sq ft.
So obviously we do want to maximize the TOD and TDR entitlements, and not blindly, but in the places that we are launching.
Understood. And the government charges of INR 330-odd crore, that excludes this TDR payment then?
So the TDR land payment, that is in the land charges, and the approval charges, which is normal license fee, TOD approval charges, TDR approval charges, those will get classified in the governmental charges.
Okay, understood. Lastly, you know, you also talked about potentially maybe buying some land parcel, which is interesting. Would you ever be looking at Dwarka Expressway market, or you'd largely focus on your side of Gurgaon?
I don't think Mr. Ohri is interested in Dwarka Expressway right now. So, I mean, currently, no, yeah.
Puneet, we've got so much happening on our side of the place, so I think we'd like to stick there.
Okay, understood. Thank you so much, and all the best.
Ladies and gentlemen, we will take that as the last question for today. I would now like to hand the conference over to Mr. Ashok Tyagi for closing comments. Over to you, sir.
Thank you so much. I mean, it was a very engaging discussion. And, you know, obviously coming off a decent quarter, I think, you know, I mean, you guys asked everything that there was to ask, especially about the launch pipeline, about the rental business, CapExes, you know, run rates. And I think we'll continue trying to, you know, do the, carry on the good work on both the RentCo and the DevCo side. I mean, currently, frankly, it's one of those virtuous cycles where the markets for both residential, retail malls and offices, all the three segments where we operate in, are all witnessing an upcycle.
So without getting reckless in terms of, you know, in terms of launches or pre-sales, we will continue to sensibly keep on launching and monetizing the stuff that we have, and hopefully continuing on our journey towards cash flow and margin. And I think really hope to, hope to see all of you again in October. Thank you.
Thank you, members of the management. Ladies and gentlemen, on behalf of DLF Limited, that concludes this conference. We thank you for joining us, and you may now exit the meeting. Thank you very much, sir.
Thank you.