The shares of this mid-cap stock jumped 9 percent after the company announced a vertical demerger of its real estate business.
Raymond Limited has a market capitalization of Rs 21,204.73 crore, the shares were trading at Rs 3199.00 per share, increasing around 8 percent as compared to the previous closing price of Rs 2,941.90 apiece.
Description of Events:-
Today the shares of the company have seen a bullish movement after Raymond Limited announced the demerger of its real estate business and transform into its wholly-owned subsidiary called Raymond Realty Ltd.
Matter Explanation:-
Moreover, after the completion of demerger, Raymond Ltd and Raymond Realty Limited (RRL) will operate as separate listed entities within the Raymond Group post all statutory approvals. The new entity will seek automatic listing on stock exchanges and according to the scheme of arrangement, each Raymond Ltd (RL) shareholder will receive 1 share of RRL for every 1 share held in Raymond Limited.
Furthermore, this strategic move comes as Raymond’s Real Estate Business has achieved scale, reporting revenue of Rs 1,593 Cr. (43% YoY growth) and EBITDA of INR 370 Cr. in FY24, positioning it well to chart its growth path as a separate entity.
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Meanwhile, Raymond Realty has 100 acres of land in Thane with an 11.4 mn sq ft RERA-approved carpet area of which about 40 acres are currently under development. There are five ongoing projects worth Rs 9,000 crore on its Thane land, with an additional potential to generate more than Rs16,000 crore, making a total potential revenue of over Rs 25,000 crore from this land bank.
Financial Performance:-
Examining the company’s financial performance, revenue magnified 21 percent from Rs 2,150 crore in Q4FY23 to Rs 2,608 crore in Q4FY24, during the same period of time, net profit increased by 17 percent from Rs 196 crore to Rs 230 crore.
Recent Developments.
Recently, Raymond Realty has launched its first JDA project in Bandra, Mumbai. Additionally, Raymond has signed three new JDAs in Mahim, Sion, and one more in Bandra East Mumbai, taking the combined revenue potential from four JDA projects in the Mumbai Metropolitan Region to over ₹7,000 crore. The development of Thane Land Bank and the current 4 JDA gives company the a potential revenue of ₹ 32,000 crore.
Company Snapshot:-
Raymond Limited, situated in India, is an integrated suiting producer that provides complete fabric and garment solutions. The company operates in eight segments: Textiles include branded fabric; shirting includes shirting fabric; apparel comprises branded readymade outfits; and garments.
Written by:- Abhishek Singh
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