DLF is going for IPO at a price band of 500-550/-
Reasons why not to invest.
1) It is a mega issue… I will be surprised if it gets fully subscribed (in all categories) leave alone over subscribed.
2) with a EPS of Rs 12.80 it will have a PE of 47.7x… too high for an industry that is facing recession.
3) With high interest rates and construction more than the requirements (yes a lot of the developed property is now waiting for occupants) i do not see a short term bright future for any company associated with real estate.
4) With Delhi and NCR almost fully saturated, DLF plans to move outside to other regions… a risk which can backfire.
My strategy… wait for the listing… if the stock lists at 450/- buy some and if it goes to less than 400 go bullish on it.
3 replies on “DLF”
Sorry I didn’t read this post. I agree with you.
Yes, the stock is definitely overvalued. The size is too large b’cos of which too mch funds will be mopped up n the market can further destabilize. In addition, the outlook for real estate is not as rosy as it was painted last yr.
Thank you Priyanka for your views and Welcome to E-Nagar