DLF-Building India

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<ul><li>1.DLF Building India ACHINTYA PR ANKIT UTTAM ARUN KS MANISH WATHARKAR NISHIGANDHA PANKAJ KUMAR PRASHANT PATRO</li></ul><p>2. Agenda 1.Industry Overview9.Legal Issues2.Company Overview10.3.DLFs core businessUps and downs seen by DLF in current years11.Competition Profiling12.Competitive analysis13.Strategies Adopted by Competitors &amp; their Impact14.Financial analysis of Competitors15.Road Ahead4. 5.DLFs Business Model Current track of Business6.Current Strategies of DLF7.Strategies adopted by DLF at different phases8.Financial Analysis of DLF 3. The Indian Real Estate Overview Considering overall economic trends, like GDP, Inflation etc, the year was not favorable for this sector Tightened credit policy made it difficult to raise funds. Demand in the housing market varied highly across regions. NCR, Chennai, Pune saw infusion of new projects due to sustained demandBangalore, Kolkata witnessed healthy supplyHyderabad, Mumbai saw restraints due to stringent changes in Development control rules. Commercial segment performed well in Mumbai, followed by Bangalore. The supply is expected to grow at moderate rate of 2%. The organised retail segment, which is expected to grow to US $42.0 bn in 2020, from US $22.5 bn now, will definitely create the demand. FDI in multi brand retail is again a catalyst. 4. Housing Growth Trajectory 5. Company Overview 6. DLF Limited (Delhi Land &amp; Finance) The largest real estate developer in India Founded by Raghuvendra Singh in 1946 and is based in New Delhi, India Builds residential, office, and retail properties. Pan India presence. The company earnings arising from development and rentals. Acquired land at relatively low cost in Gurgaon, after the Delhi development act that controlled the real estate in Delhi In the mid-1970s, the company started developing their DLF City project at Gurgaon. Its exposure across businesses, segments and geographies, mitigates any down-cycles in the market. Developed 22 major colonies in Delhi, DLF is now present across 15 states-24 cities in India. 7. Vision, Mission &amp; Values Vision To contribute significantly to build the new India and become the words most valuable real estate company Mission To build world-class real-estate concepts across six business lines with the highest standards of professionalism, ethics, quality and customer service. Values Sustained efforts to enhance customer value and qualityEthical and professional serviceCompliance and respect for all community, environmental and legal requirements. 8. Value Proposition Multi-business, multi-segment across geographies, mitigating cycles in the business A mix of development earnings and rental / incremental earnings High quality zoned land resource with development potential for more than ten years Strong execution strengths based on deep long-term relationships with companies like Shapoorji, etc. and partnerships such as LOR, WSP, etc. Raised resources from capital markets, primarily for investments in long-term businesses such as Hotels and large townships / SEZs Build-up of embedded value in many businesses, like LOR, DLF Utilities, etc. 9. Milestones 2004 Commences development of DLF Cybercity in Gurgaon2003 2002Ventured into Grade A office spaces in GurgaonVentured into group housing project1985 1950-64Founded by Choudhury Raghavendra SinghVentured into organised retail complexes1999 1996Commenced development of 3,000-acre DLF City, GurgaonLaunched premium residential complexes with luxurious milieu of the Golf Links1946Development of 22 urban colonies like SouthEx, GK, Kailash Colony, Hauz Khas2012Launched Capital Greens, the largest private sector residential projects in DelhiFormed JVs with Prudential for Life Insurance &amp; AMC. Also entered Capital marketsFocus on IT Parks and next generation malls2010Launched plots in Gurgaon after a decade, creating a suburb- New Gurgaon2008Commenced operations of DLF Emporio, Indias first luxury mall2006Delivered Delhis first Automated Car Parking in Sarojini NagarLaunched 8.3 Km Gurgaon Expressway 2nd automated Car Parking in CP, DelhiSignificant progress in pursuing and ramping up new businesses Hotels and Large Townships2011200920072005 10. Corporate strategy Business organised on vertical basis: Homes, Office, Retail, Hotels, etc., each independent of the other Same structure is followed not only at the corporate level, but flows down to the regional/local level DLF, at the corporate level, plays the role of an aggregator of businesses where stiff, competing interests of different SBUs and businesses get aligned, resulting in sum of parts being worth more than parts Going forward, DLF plans to monetize subsidiaries/assets to unlock the embedded value With core businesses reaching stable operating performance, focus is to aggressively ramp up new businesses like hotels, infrastructure, SEZs, etc. Key focus on execution of projects The compensation structure within allows the mid / senior level employees for participation in the success of various projects/businesses 11. LOGO 12. LOGO The pyramid symbol and the mission line 'Building India is collectively referred to as the DLF Logo. The company's name is represented in black capital letters. The typeface represents the solidity of the enterprise; emphasizes accountability, responsibility as being a strong and integral part of the Group's ethos. The pyramid depicts nine smaller pyramids; each composes itself into a larger pyramid all-encompassing in nature and presentation. The pyramid itself and the component pyramids convey cohesion, interdependence, support and foundation, to a common purpose and to achieve greater heights. The words BUILDING INDIA, is in capitals like the companys name, and at once conveys DLFs mission and vision. It is an intrinsic reflection of the Groups commitment and its 60-year heritage 13. DLFs Core Business 14. DLFs Core BusinessesDLF Core BusinessHomesOfficeNew BusinessRetailHotelsSEZsInfrastructureExecutionEnablersInvestments 15. Homes Pioneered townships and group housing in India Offers plots and urban colonies as well Introduced the super-luxury and luxury category for homes Business model allows pre-sale of property prior to breaking ground, leading to positive cash flows Trusted brand with superior execution track record First group housing project launched in 1996 Operates in three main subcategories: Super Luxury Luxury Mid Income 16. Office India being the major part of growth strategies for every multinational there is a large demand of office space. DLF is the founder of Grade A office leasing market: in India Offers well-balanced mix of commercial office space including IT/ITES facilities, multi-tenant corporate office buildings and integrated commercial complexes Continue to leverage location advantages and deep customer relationships to enter new geographies Operates mainly in two subcategories: Lease: Sale A perfect model of long term rental flows and selling propertiesto a listed business trust, with a long-term fee income as earnings 17. Retail Given the scarcity of quality organized retail, DLF enjoys the benefits of a portfolio of premium locations across the country and rush by large retailers DLF envisages to introduce a new retail infrastructure to cater to the need for shopping malls and commercial centers across al segments and all places in India All major retail players, including new entrants pitch aggressively for space in DLF Malls Introducing the concept of Next Generation Theme Malls Operates under two subcategories Sale: Commercial complexes and smaller malls Build and sell model for commercial complexes and shopping centers Introducing commercial spaces with small offices, small shopsLease: Large malls Build and lease model for Malls Leasing would ensure strong and sustained rentals given the increasing demand Rental values increasing substantially due to better mix 18. Hotels Operates under a separate entity namely; DLF Hotels Holdings Limited The objective is to develop, acquire, finance and actively manage world-class hospitality properties Plans to develop 5000 luxury hotel rooms and 20000 business hotel rooms in next 5 years. These are being developed under the luxury, business, leisure &amp; recreational segments of the hospitality industry Operates under three main subcategories: Hilton JV: Business Hotels/Serviced ApartmentsAman Acquisition: Part of luxury strategyOther Luxury Hotels 19. Special Economic Zones SEZs are developed keeping in view the zooming demand for office and commercial space, especially for the knowledge industry With the economic policies of the country directed towards modern infrastructural development, the focus is also increasingly expanding towards the development of modern Special Economic Zones (SEZs) DLF is the founder of SEZ market in India, with current occupancy of 98% IT parks developed at Gurgaon, Noida, Chandigarh, Kolkata, Bangalore, Hyderabad, Chennai, Bhubaneswar and Nagpur. Currently two SEZ works under progress Manesar SEZ &amp;Ambala SEZ 20. Infrastructure Current rate of infrastructure investment in India, at 3.5% of GDP, is well below the target rate of 8.0% proposed by the Expert Group on Commercialization of Infrastructure Projects Started with South Square multi-level car parking, Sarojini Nagar Market, Capitol Point Baba Kharag Singh Marg, DLF Huda Expressway, Gurgaon Partner with several multinationals like Laing ORourke to gain expertise and participate in the construction of infrastructure projects including roads, bridges, tunnels, pipelines, harbors, runways and power projects MoU signed with Fraport AG for development and management of airport projects in India. 21. Enablers Laing ORourke 50:50 JV with LOR, a leading UK based construction company with expertise in construction of infrastructure projects including roads, bridges, tunnels, pipelines, harbors, runways and power projects Created an opportunity to exploit new sources of revenue JV has commenced development of 16 projects covering a total area of 40 msf DLF-LOR has submitted tenders for construction of various infrastructure projects including roads, laying of railway tracks, airport terminals and a port WSP 50:50 JV with WSP for engineering and design consultancy and project management services WSPs experiences include world class projects such as Freedom Tower at Ground Zero, New York; the Mall of the Emirates, Dubai; and major developments at Heathrow and Stansted Airports in London WSP to bring specialist staff and expertise from their global operations to support local professionals 22. Partners of DLF Laing O'Rourke is a UK-based construction company will construct all DLF's landmark projects Nakheel of Dubai are partnering with DLF for developing townships in India. WSP Group Plc is partnering DLF, providing management and consultancy to the built and natural environment Feedback Ventures is providing consultancy for faster project execution. Hilton Hotels are partnering DLF to jointly develop hotels in India 23. Business Model of DLF 24. Business Model DLF's primary business is development of residential, commercial and retail properties. The company has a unique business model with earnings arising from development and rentals. Its exposure across businesses, segments and geographies. DLF has also forayed into infrastructure, SEZ and hotel businesses. The DLF real estate management has got a business model which enables seamless integration of real estate business model owing to its business operation spanning across land, design, construction, facilities and marketing. These bouquet of services are managed by a team of professionals with expertise spanning across these functions 25. DLFs Business model mainly consist of two models: Development BusinessAnnuity Business Development Business: The development business of DLF includes Homes and Commercial Complexes. The Homes business caters to 3 segments of the residential market - Super Luxury, Luxury and Mid-Income. The product offering involves a wide range of products including condominiums, duplexes, row houses and apartments of varying sizes. DLF has 216 msf of developed area under homes and residential plots. Annuity Business: The annuity business consists of the rental businesses of offices and retail. With over six decades of excellence, DLF is a name synonymous with global standards, new generation workspaces and lifestyles. It has the distinction of developing commercial projects and IT parks that are at par with the best in the world. DLF has become a preferred name with many IT &amp; ITES majors and leading Indian and International corporate giants, including GE, IBM, Microsoft, Canon, Citibank, Vertex, Hewitt, Fidelity Investments, WNS, Bank of America, Cognizant, Infosys, CSC, Symantec and Sapient, among others. 26. The New Business Model Approach In 2006, the company adopted a new business model to cover all the aspects of the realty sector in detail The old business model was completely changed The new business model is divided into four important components: Design &amp; Development ManagementRetail Management &amp; Operational LeasingStrategic Marketing &amp; PromotionsProperty management 27. Design &amp; Development Management DLF Realty project team collaborates with world class architectural firms to create un paralleled home, retail spaces which include shopping malls and integrated developments. One of the distinctive in house services consists of tenancy design and coordination functions. The designs of the apartments undergo serious scrutiny and checks within the company in various divisions like quality, strength et al. The development phase is carried on once the design is approved from the approving department DLF not only develops projects but creates unique propositions to anchor its developments such as: DLF EmporioDT Cinemas 28. DLF Emporio: This is the first of its kind in India. People will be having an opportunity to witness the creations of 185 of the finest luxury brands in the world. Over 74 international labels and over 100 Indian designers participate in this Cafe E in the atrium offers world gourmet cuisine and Set'z, is a spectacular 5 cuisine restaurant designed by the famous Super Potato of Hong Kong which adds to the attraction to the mall. The beautiful architecture and lavish interiors of DLF Fmpono are designed to make shopping a pleasure. Generous spaces, Italian marble, soaring atria and dazzling chandeliers are some of the features of this style 29. Management &amp; Operational Leasing DLF considers the retailers and its end user customers in the apartments as not only as customers but also as partners in all the developments. When it comes to Retailers segment, DLF Retail has built an extensive network with national and international retailers and leverages on this established network to create an optimal tenancy mix in all its projects. With innovative...</p>