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DLF discloses Rakesh Jhunjhunwala’s stake for first time; big bull holds 0.67% equity in company

The big bull made his first share purchase of the Delhi-based realtor in 2016, according to a source

Dhirendra Tripathi @dtrips
 
 
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Big bull Rakesh Jhunjhunwala holds 1.19 crore shares in DLF, according to a disclosure made for the first time by India’s largest real estate company. As per information available on BSE, the company’s equity base comprised 178.40 crore shares as on March 31, 2018. His stake thus equals 0.67 percent of the company’s total equity.

At today’s price of Rs 216, Jhunjhunwala’s DLF stake is worth Rs 257 crore. According to a source, his last purchase was at Rs 170. JP Morgan has an ‘overweight’ rating on the stock with a target price of Rs 280 by March 1, 2019.

The information of Jhunjhunwala’s holding in DLF was so far not made public as neither DLF nor the billionaire investor was legally required to disclose this. Neither is it required now but nonetheless, the company has made it public.

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The big bull made his first share purchase of the Delhi-based realtor in 2016, according to the source. He bought and sold shares of the company during 2017-18, according to the annual report. At the start of the last financial year (April-March), he held 75 lakh shares of the company equivalent to 0.42 percent stake in the company.

Jhunjhunwala normally acquires shares in his own name or his wife Rekha’s and sometimes also through his firm Rare Enterprises. The DLF holding is in his own name.

As a practice, Jhunjhunwala, known for his stakes in Lupin and Titan, usually doesn’t discuss his stock-specific investments.

Jhunjhunwala’s investments in stocks are widely tracked by market followers, their disclosures at times leading to run-up in the price of the given scrip in short-term.

While it cannot be said with certainty but going by available information, the DLF holding is the second acquisition by Jhunjhunwala in a Delhi NCR-based company, the other being Jaiprakash Associates. The Manoj Gaur-run company also has exposure to real estate. A second acquisition is thus surprising since he is a big critic of the Indian real estate sector.

According to a BSE disclosure by Jaiprakash for April-June, he held 5 crore shares in the Noida-based company, equalling 2 percent equity of the company.

Fortunes may be turning around for DLF as its home market of Gurugram in Haryana and the competing areas of Noida, Ghaziabad and Greater Noida in Uttar Pradesh and Faridabad, also in Haryana, are seeing an exit of small-time realtors, leaving large established ones like DLF to reap the benefit.

The company also recently made an accounting change under which it is now booking sales only on handover of the property. The company also plans to do a Rs 4,000-crore qualified institutional placement this financial year, all of this lending solidity to the company’s books.

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First Published on Aug 30, 2018 01:58 pm
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