Raymond Shares Gain 5% on this Unexpected Move

Helping You Build Wealth With Honest Research
Since 1996. Try Now

  • MyStocks


Login Failure
(Please do not use this option on a public machine)
  Sign Up | Forgot Password?  

Raymond Shares Gain 5% on this Unexpected Move

Sep 28, 2021

Raymond share price gained over 5% today after the board approved the consolidation of tools & hardware and auto components businesses into an engineering business.

Apparel and textile company Raymond said its directors have approved plans to consolidate the tools and hardware and auto components businesses into engineering business for improving synergies and exploring monetisation options for deleveraging the company.

In an official statement, the firm said the objective behind the move is to create value for shareholders.

The engineering business has achieved scale and improved market share in both domestic and global markets.

These businesses have demonstrated growth in earnings before interest, taxes, depreciation, and amortisation (EBITDA) margins, generated free cash flows, and are debt-free.

--- Advertisement ---
The Hidden Opportunity in EV Stocks No One Knows About

With today's fast-changing technology and concern about the environment, the popularity of electric vehicles (EVs) has been on the rise.

Most investors go the usual route of investing in large companies and waiting to rake in profits.

We believe that's not the best approach.

In fact, our research has uncovered a hidden way to make potentially windfall gains from this EV opportunity.

Interested to know more? You can get all details by clicking the link below:

Equitymaster's Latest Research Project - Details

Gautam Hari Singhania, Chairman & Managing Director, said,

  • Raymond believes in nurturing and growing each of its businesses. I am happy to share that our Engineering business comprising of Tools & Hardware and Auto Components has demonstrated good performance and it is poised for future growth.

    We are consolidating the business to explore all options available to us for monetisation, which will enable deleveraging leading to value creation.

As part of the scheme, the tools and hardware and the auto components businesses will be merged into JK Files, a wholly-owned subsidiary of the company.

Raymond Realty to become a wholly-owned subsidiary

To achieve high growth momentum in the real estate business, the board also gave in-principle approval for subsidiarisation of the real estate business division through a wholly-owned subsidiary.

Launched in 2019 with the development of land in Thane, Raymond said its real estate business is now poised for growth with a focus on delivering a value-based offering.

'The real estate division is a sustainable profitable business led by experienced professional team with a clear long-term strategy in place,' the company said, adding the vertical now plans to capitalise on its strengths by extending beyond Thane.

It will deliver around 3 million sq ft of residential projects and has already achieved sales of over 70% of launched inventory of around 2 million sq ft.

Stating that the realty business has showcased performance since its launch, Singhania said,

In order to realise its full potential, it will now be a wholly-owned subsidiary of Raymond.

Alert: Discover Richa's Top 3 Stock Picks for 2022...

Demerger of the lifestyle business withdrawn

The company had in November 2019 announced the demerger of its apparel business held under the wholly-owned company Raymond Apparel.

The demerger scheme has been withdrawn and the lifestyle business will now be transferred to parent Raymond to streamline the group's B2C businesses.

This move will strengthen efficiencies, streamline, and simplify processes and bring in synergy benefits in terms of design and innovation, sourcing, and retail network.

The firm said in order to execute these decisions, it withdrew the de-merger scheme of lifestyle business announced in November 2019.

Company financials

Raymond reported a consolidated net loss of Rs 1.6 bn for the quarter ended June 2021. The company had posted a net loss of Rs 2.5 bn during the April-June quarter of the previous fiscal.

However, its revenue from operation rose over four-fold to Rs 8.3 bn against Rs 1.6 bn in the same period of the previous fiscal.

Consumer sentiments were seen to be positive during the month of June with higher number of wedding dates.

Raymond was also able to maintain strong profitable momentum in the engineering business as it focused on exports as the domestic market was impacted due to lockdown.

In the June quarter, the company increased its promoter holding to 49.12% from 48.84%.

To know more, check out Raymond's latest shareholding pattern.

--- Advertisement ---
Ride Extreme Market Swings Successfully...

This is what happened at 20:02 minutes...

Watch Full Replay of Lazy Millionaire

How the stock markets reacted to Raymond

Shares of Raymond opened the day at Rs 459 on the BSE and Rs 460.9 on the NSE.

Its share price closed at Rs 455.2 (up 1.7%) on the BSE and Rs 454.5 (up 1.5%) on the NSE.

The share touched its 52-week high of Rs 473.9 and 52-week low of Rs 262.9 on 19 July 2021 and 4 November 2020, respectively.

Over the last 30 days, the Raymond share price is up 13%. Over the last one year, the company's share price is up 80.4%.

About Raymond

Raymond Group is an Indian branded fabric and fashion retailer, incorporated in 1925. It produces suiting fabric, with a capacity of producing 31 million meters of wool and wool-blended fabrics.

The group owns apparel brands like Raymond, Raymond Premium Apparel, Raymond Made to Measure, Ethnix, Park Avenue, Park Avenue Woman ColorPlus, Kamasutra & Parx.

All the brands are retailed through 'The Raymond Shop' (TRS), with a network of over 700 retail shops spread across India and overseas, in over 200 cities.

In addition, the group also has business interests in readymade garments, designer wear, cosmetics & toiletries, engineering files and tools, prophylactics and air charter operations.

In 2019, Raymond announced its venture into real estate business under Raymond Realty.

For more details about the company, you can have a look at Raymond's factsheet and quarterly results on our website.

To know what's moving the Indian stock markets today, check out the most recent share market updates here.

Disclaimer: This article is for information purposes only. It is not a stock recommendation and should not be treated as such. Learn more about our recommendation services here...

Equitymaster requests your view! Post a comment on "Raymond Shares Gain 5% on this Unexpected Move". Click here!


More Views on News

RAYMOND 2020-21 Annual Report Analysis (Annual Result Update)

Oct 20, 2021 | Updated on Oct 20, 2021

Here's an analysis of the annual report of RAYMOND for 2020-21. It includes a full income statement, balance sheet and cash flow analysis of RAYMOND. Also includes updates on the valuation of RAYMOND.

7 Indian Companies that Swear by Buffett's No-Split Rule (Views On News)

Sep 28, 2021

Just like Warren Buffett's Berkshire Hathaway, these Indian companies have not split their shares.

Top Performing Penny Stocks of 2021 (Views On News)

Aug 28, 2021

Several penny stocks have delivered multi-fold returns in a short span of time. Here are a few of them.

Grasim Results Review: Net Profit Beats Estimates as Revenues Rise 182% (Views On News)

Aug 16, 2021

Higher VSF exports help Grasim amid weak domestic demand.

Rupa & Company Stock in Focus on Strong Quarterly Results (Views On News)

Jun 1, 2021

Here's a rundown on the latest quarterly results of Rupa and Company.

More Views on News

Most Popular

All You Need to Know About Primary and Secondary Markets

A look at the various types of primary and secondary markets and the key differences between them.

These 5 Penny Stocks are Held by Rakesh Jhunjhunwala. Worth a Look? (Views On News)

Jan 18, 2022

Rakesh Jhunjhunwala is holding these penny stocks in his portfolio for several years now.

Time to Buy Energy Stocks (Fast Profits Daily)

Jan 14, 2022

Energy is a sector that looks set to take off. It's time to get in.

Tech Mahindra's CTC Acquisition: Too Expensive? (Views On News)

Jan 18, 2022

Tech Mahindra's acquisition of European IT-company fails to excite investors.

5 Hidden Tata Group Companies to Add to Your Watchlist (Views On News)

Jan 18, 2022

Here's all you need to know about these five Tata group stocks that aren't as popular as the others.


Become A Smarter Investor
In Just 5 Minutes

Multibagger Stock Guide 2022
Get our special report Multibagger Stocks Guide (2022 Edition) Now!
We will never sell or rent your email id.
Please read our Terms


Jan 25, 2022 (Close)


  • 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