India's largest listed developer, DLF Ltd, which raised some Rs9,000 crore in its first share sale in July, is looking at the possibility of selling stakes in various businesses that will become separate companies.

"Each entity of DLF is phenomenally big. We are quite sure we want to go for a listing of each of the entities at a right time," says Ramesh Sanka, DLF's chief financial officer. "We will nurture them (entities) and then we will hive off whether it is insurance, telecom, hotels or even the residential business."

"In the next eight-nine months to three years, lots of listings will happen," predicts Sanka. The offices' arm of DLF is already getting indirectly listed through DLF Assets Pvt. Ltd, a unit.
The company is looking at selling 10-20% stakes in the subsidiaries.

DLF's July offer was the largest initial public share offer in India and the shares have risen 92.4%, to Rs1,010.05 a share, since its listing. Since August, the company has more than doubled its market capitalization while the benchmark Sensex index has risen 25%. DLF became part of the Bombay Stock Exchange Sensex index in November.
Despite this, "today, valuing DLF is a very difficult task," claims Sanka. "But, tomorrow, if I have six-seven subsidiaries, a single business matrix is easy to value. Even for analysts, it is quite difficult to put a value on DLF."

DLF now has many business lines that go beyond building homes, shopping malls and offices. It has announced partnerships to set up hotels with Hilton Hotels Corp.; it is bidding for telecom licences to offer mobile phone services in one of the fastest growing cellphone markets in the world; it plans to offer insurance services and wants to build airports, roads and ports.

DLF will initially expand the entities in terms of employees and basic assets before hiving them into separate companies. The company might even look at listing the entities as real estate investment trusts in India once the market regulator, Securities and Exchange Board of India, lays down rules on real estate investment trusts, which is expected early in 2008.