This Article is From Oct 11, 2012

UBS maintains buy on DLF despite Kejriwal's allegations, Goldman downgrades to neutral

UBS maintains buy on DLF despite Kejriwal's allegations, Goldman downgrades to neutral

Investment bank Goldman Sachs on Thursday downgraded real estate major DLF to 'neutral' from 'buy', saying slower approvals could result in fewer project launches, even as Swiss financial services company UBS said activist Arvind Kejriwal’s accusations would have limited impact on the company. It has maintained a ‘buy’ rating.

"With the stock down 11 per cent on the back of this news flow, and our expectation of no material impact on DLF's business—we believe concerns are largely priced in," UBS said in a note.

Goldman has also cut its pre-sale estimates for India's largest property developer and removed it from its Asia-Pacific buy list, cutting its 12-month target price to Rs. 224 from Rs 257.

Shares of the company have been under pressure since activist-turned-politician Kejriwal accused DLF of having extended an interest-free loan of Rs 65 crore to businessman Robert Vadra, the son-in-law of Congress president Sonia Gandhi, in return for favours from the Congress government in Haryana. Mr Vadra, DLF and the Haryana government have all refuted the allegations.

Shares of India's largest real estate developer declined for the third straight day yesterday over fresh accusations by Mr Kejriwal. The stock closed 5 per cent lower at Rs. 213.10 (provisional) on the National Stock Exchange. It was the top loser on the 50-share Nifty benchmark.

The stock has plunged over 11 per cent since Monday.

With inputs from Reuters

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