DLF - Investment Analysis

Last Updated Time : 02 Aug 25, 12:58 am

Investment Rating: 3.7

🏢 Fundamental Analysis: DLF Ltd.

DLF is one of India’s largest real estate developers, with a strong brand, low leverage, and improving profitability. However, its high valuation and modest capital efficiency temper its long-term investment appeal.

Metric Value Implication

P/E Ratio 42.6 Slightly overvalued vs. industry average of 40.2

PEG Ratio 1.03 Fairly valued based on growth; neutral signal

ROCE / ROE 6.51% / 11.4% ROE acceptable; ROCE low — weak asset efficiency

Dividend Yield 0.75% Low; not attractive for income investors

Debt-to-Equity 0.10 Very low — strong balance sheet

EPS ₹17.6 Reasonable earnings base

Qtr Profit Var +39.4% Strong growth momentum

FII/DII Holding Change -0.29% / +0.29% Mixed institutional sentiment

📉 Technical Analysis

Current Price: ₹800

DMA 50 / DMA 200: ₹813 / ₹776 → Slightly below 50-DMA; neutral to weak trend

RSI: 39.4 → Near oversold zone; potential bounce

MACD: -3.15 → Bearish crossover; short-term weakness

Volume: Below average; low conviction in recent moves

💰 Ideal Entry Price Zone

₹750–₹780

This range aligns with 200-DMA support and RSI oversold levels

Avoid entry above ₹850 unless ROCE improves and price consolidates

📈 Long-Term Investment Outlook

Strengths

Strong brand and leadership in Indian real estate

Low debt — excellent financial discipline

PEG near 1 — fair valuation for growth

High quarterly profit growth — momentum in earnings

Risks

ROCE < 7% — poor capital efficiency

P/E > 40 — expensive relative to earnings

RSI and MACD suggest short-term weakness

Real estate sector cyclicality — sensitive to interest rates and policy

DLF is a moderate-to-high quality stock in a cyclical sector. It’s suitable for long-term investors who can tolerate volatility and are betting on India’s urban expansion and real estate demand.

🏁 Exit Strategy / Holding Period

If you already hold DLF

Holding Period: 2–3 years to ride sectoral growth and earnings momentum

Exit Strategy

Consider partial profit booking near ₹900–₹930 (recent high)

Reassess if ROCE doesn’t improve above 8% or if earnings stagnate

Hold if quarterly profits continue to grow and debt remains low

Would you like a comparison with peers like Godrej Properties, Oberoi Realty, or Macrotech Developers to explore better capital efficiency or growth profiles?

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