InvestorQ : Is it true that DLF is planning to make a big foray into the middle income home segment?
manisha Kolvenkar made post

Is it true that DLF is planning to make a big foray into the middle income home segment?

Crowny Pinto answered.
11 months ago

That does look like a major shift out of the core business approach of DLF but that is a reality. In fact, DLF is already in the process of launching mid-income projects, in the affordable Rs.60-80 lakh price category across some of the fast growing cities in India.

In the last few months following the COVID-19 pandemic and the subsequent lockdown, the demand for luxury apartments has largely dried up as buyers have turned conservative. However, the middle-end market in the price range mentioned above sees robust demand.

It may be recollected that DLF, as a policy decision, has substantially stopped selling under-construction projects. Now it sells only when a project is close to completion and this also saves DLF from the stringent provisions of the state level RERA Act.

The reason I am calling this a shift is because DLF has traditionally operated at the higher end of the real estate market. However, now DLF sees a huge opportunity in catering to the mass market and wants to make up with customized products for that segment.

The demand for retail housing projects had taken deep hit due in the aftermath of the COVID-19 pandemic and the consequent lockdown restrictions. Recovery still appears to be some time away, at least in the major urban geographies of India.

Apart from its core focus on the Delhi / NCR region, the focus of DLF will now shift to cities like Trichy and Chandigarh where it sees a huge potential to sell mid-range projects. DLF is already working toward eliminating its balance sheet leverage during 2021.