New Delhi: DLF Ltd, the country's largest real estate firm, today said it has no unsold inventories despite slowdown in the property market as the company mostly sells flats before the start of construction of projects.
"We have always followed the model where we sell the project before we start construction and this approach ensures that we do not have an inventory of flats," DLF group executive director Rajeev Talwar said.
DLF said the Rs. 17,645 crore mentioned in the books of accounts under head 'Inventories' represents mainly cost of land and plots, construction and development material.
He noted that there is "absolutely no pile up" of unsold flats despite slowdown in the property market.
Mr Talwar, however, said that the company has adopted the model of simultaneously constructing and selling flats few months back in couple of its projects, including 'The Crest' in Gurgaon.
Under this model too, the company does not hold on to an unsold inventory of flats, he explained.
"A project typically takes around four years to execute so whatever we build each year, will easily find buyers. To that extent, we are inventory proof," Mr Talwar said.
He said the inventories mentioned in the company's annual report for 2012-13 fiscal was towards cost of land and plots, construction and development material and even stock of food and beverages.
"The definition of inventory is very different as far as DLF is concerned and it no way represents any unsold flats because our model prevents any such pile up," Mr Talwar said.
DLF had reported 38 per cent fall in the consolidated net profit at Rs. 181.19 crore for the quarter ended June 30 on higher expenses. The company had posted a net profit of Rs. 292.79 crore in the year-ago period.
However, income from operations increased by 5 per cent to Rs. 2,314.08 crore in the first quarter of this fiscal compared with Rs. 2,197.71 crore in the corresponding period of last fiscal.
