Real estate developer DLF Ltd’s operating business has stabilised but new accounting standard hurts with material pick-up is still several quarters away, says HSBC Global Research.

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DLF’s adoption of new accounting standard IndAS 115 has resulted in 15 percent net worth erosion or equivalent of 6-7 years of reported profitability pre-FY18 and de-recognition of Rs 140 billion of sale, it said.

As per IndAs, real estate companies including DLF can recognise revenue only on completion of projects.

Earlier this month, DLF reported a 26 percent fall in quarterly revenue from operations.

HSBC retains ‘hold’ rating, and maintains target price at Rs 217.

Shares of DLF fell as much as 3.5 percent to Rs 207.25 on Tuesday, its biggest intraday percent drop since August 2. The stock is down 17 percent this year as of last close.

DLF is top drag on Nifty Realty index, which is down as much as 1.7 percent. Shares traded at Rs 208.35, declining by 3.03 percent on the NSE at 3.28 pm.