DLF plans to raise Rs 3,500 cr via CMBS issue

DLF is planning to raise up to R3,500 crore through the issue of securities backed by IT-SEZs to replace its costlier debt.

In May, DLF had launched the country’s first Commercial Mortgage Backed Securities (CMBS) to raise R525 crore against a shopping mall DLF Emporio in New Delhi.

Last month, it raised another R375 crore through CMBS backed by DLF Promenade mall, taking the total proceeds to R900 crore. The two luxury malls have 7.5 lakh sq ft of leasable area.

According to sources, DLF plans to raise further around R3,000-3,500 crore through the CMBS route backed by some of its IT-SEZs. The company has office assets of 26-27 million sq ft, of which 12 million sq ft is IT-SEZs. Overall its annuity income grew to R1,950 crore during the financial year 2013-14.

It would utilise the funds from this process to improve its balance sheets and access cheaper debt, they said, adding that Credit Suisse will help DLF in the CMBS issue.

In the two rounds of CMBS, DLF raised funds at a coupon rate of 10.9% per annum and maturity of 7.5 years.

DLF’s net debt stood at R18,526 crore as on March 31, 2014, a drop of R1,400 crore from R19,926 crore at the end of the October-December quarter. The company’s finance cost stood at nearly R2,500 crore last fiscal.

DLF Ltd