X

Sign up for Equitymaster's free daily newsletter, The 5 Minute WrapUp and get access to our latest Multibagger guide (2017 Edition) on picking money-making stocks.

This is an entirely free service. No payments are to be made.


Download Now Subscribe to our free daily e-letter, The 5 Minute WrapUp and get this complimentary report.
We hate spam as much as you do. Check out our Privacy Policy and Terms Of Use.
Raymond: Extraordinary gains - Views on News from Equitymaster
 
 
  • PRINT
  • E-MAIL
  • FEEDBACK
  • A  A  A
  • Apr 24, 2001

    Raymond: Extraordinary gains

    Raymond Limited has recorded a 125% decline in sales for the fourth quarter ended 31st March 2001 to Rs 14,571 m. The drop in sales in vindicated from the fact that the company sold both its steel and cement division, which contributed to around 51% of the FY00 turnover of the company.

    (Rs m) FY00 FY01 Change
    Sales 16,579 14,571 -12.1%
    Other Income 184 157 -14.4%
    Expenditure 14,184 13,388 -5.6%
    Operating Profit (EBDIT) 2,395 1,182 -50.6%
    Operating Profit Margin (%) 14.4% 8.1%  
    Interest 946 799 -15.5%
    Depreciation 997 814 -18.4%
    Profit before Tax 636 (273) -143.0%
    Other Adjustments (277) 3,906  
    Tax 43 310 629.4%
    Profit after Tax/(Loss) 317 3,322  
    Net profit margin (%) 1.9% 22.8%  
    No. of Shares (eoy) (m) 75.1 75.1  
    Diluted number of shares 75.1 75.1  
    Earnings per share (Rs) 4.2 44.2  

    The company was expected to save more than 30% of its total raw material costs as a result of this disinvestment. But the decline is lesser than what we had expected as both these divisions contributed to the turnover in the first quarter of the current year. Raw material costs as a percentage of sales have dropped significantly from 28.2% in FY00 to 24.5% in FY01. Going forward, operating expenditure as a percentage of sales is expected to drop from 85.5% in FY00 to 75.6% in FY02.

    Lowering costs…
    (Rs m) FY98 FY99 FY00 FY01UA
    Material cost 4,076 4,222 4,672 3,575
    % of sales 33.8% 32.9% 35.6% 24.5%
    Manufacturing costs 3,403 3,140 3,318 3,238
    % of sales 28.2% 24.4% 25.3% 22.2%
    Labour costs 1,286 1,370 1,364 1,603
    % of sales 10.7% 10.7% 10.4% 11.0%
    Administration & selling 1,269 1,462 1,508 3,271
    % of sales 10.5% 11.4% 11.5% 22.4%

    The extraordinary item here includes net surplus from the sale of the cement and the steel divisions of Rs 4,472 m, loss on sale of debentures of Reliance Industries of Rs 980 m and other non-incurring expenditure of Rs 99 m. This also include the gain on stock transfer of steel and cement division of Rs 514 m (Raymond, in its second quarter results, had actually reported a loss on sale of steel plant to the extent of Rs 1,760 m). Excluding the extraordinary income, the company has actually reported a net loss of Rs 583 m.

    The scrip is currently trading at Rs 110, at a P/E multiple of 9.4x the annualised third quarter earnings. It has proposed a dividend of Rs 3 per share (dividend yield of 2.9%).

     

     

    Equitymaster requests your view! Post a comment on "Raymond: Extraordinary gains". Click here!

      
     

    More Views on News

    Discover the Secrets of Hidden Smallcaps From These AGMs (The 5 Minute Wrapup)

    May 26, 2017

    Don't be surprised to come across some Super Investors there!

    More Views on News

    Most Popular

    A 'Backdoor' to Multibaggers: It's Like Investing in Asian Paints Ten Years Ago(The 5 Minute Wrapup)

    Aug 10, 2017

    Don't miss these proxy bets on growing companies or in a few years you will be looking back with regret.

    The Most Profitable Investment in the History of the World(Vivek Kaul's Diary)

    Aug 8, 2017

    'Yes, it looks like a bubble. And, yes, it's like buying a lottery ticket. But there's something happening that has never happened before. It's an evolutionary leap in money itself.'

    Should You Invest In Bharat-22 ETF? Know Here...(Outside View)

    Aug 8, 2017

    Bharat-22 is one of the most diverse ETFs offered so far by the Government. Know here if you should invest...

    Signs of Life in the India VIX(Daily Profit Hunter)

    Aug 12, 2017

    The India VIX is up 36% in the last week. Fear has gone up but is still low by historical standards.

    Bitcoin Continues Stellar Rise(Chart Of The Day)

    Aug 10, 2017

    Bitcoin hits an all-time high, is there more upside left?

    More
    Copyright © Equitymaster Agora Research Private Limited. All rights reserved.
    Any act of copying, reproducing or distributing this newsletter whether wholly or in part, for any purpose without the permission of Equitymaster is strictly prohibited and shall be deemed to be copyright infringement.

    LEGAL DISCLAIMER: Equitymaster Agora Research Private Limited (hereinafter referred as 'Equitymaster') is an independent equity research Company. Equitymaster is not an Investment Adviser. Information herein should be regarded as a resource only and should be used at one's own risk. This is not an offer to sell or solicitation to buy any securities and Equitymaster will not be liable for any losses incurred or investment(s) made or decisions taken/or not taken based on the information provided herein. Information contained herein does not constitute investment advice or a personal recommendation or take into account the particular investment objectives, financial situations, or needs of individual subscribers. Before acting on any recommendation, subscribers should consider whether it is suitable for their particular circumstances and, if necessary, seek an independent professional advice. This is not directed for access or use by anyone in a country, especially, USA or Canada, where such use or access is unlawful or which may subject Equitymaster or its affiliates to any registration or licensing requirement. All content and information is provided on an 'As Is' basis by Equitymaster. Information herein is believed to be reliable but Equitymaster does not warrant its completeness or accuracy and expressly disclaims all warranties and conditions of any kind, whether express or implied. Equitymaster may hold shares in the company/ies discussed herein. As a condition to accessing Equitymaster content and website, you agree to our Terms and Conditions of Use, available here. The performance data quoted represents past performance and does not guarantee future results.

    SEBI (Research Analysts) Regulations 2014, Registration No. INH000000537.

    Equitymaster Agora Research Private Limited. 103, Regent Chambers, Above Status Restaurant, Nariman Point, Mumbai - 400 021. India.
    Telephone: +91-22-61434055. Fax: +91-22-22028550. Email: info@equitymaster.com. Website: www.equitymaster.com. CIN:U74999MH2007PTC175407
     

    Become A Smarter Investor In
    Just 5 Minutes

    Multibagger Stocks Guide 2017
    Get our special report, Multibagger Stocks Guide (2017 Edition) Now!
    We will never sell or rent your email id.
    Please read our Terms

    RAYMOND SHARE PRICE


    Aug 21, 2017 03:37 PM

    TRACK RAYMOND

    • Track your investment in RAYMOND with Equitymaster's Portfolio Tracker. Set live price alerts, get research alerts and more. Get access now...
    • Add To MyStocks

    RAYMOND 8-QTR ANALYSIS

    Detailed Quarterly Results With Charts

    COMPARE RAYMOND WITH

    MARKET STATS