Raymond's Bold Move: Demerger of Realty Business Brings Shares Soaring
Raymond Ltd's shares skyrocketed 18% after the company announced the demerger of its real estate business into a wholly-owned subsidiary, Raymond Realty Limited.
Raymond LtdDemergerRealty BusinessReal EstateTextile IndustryReal Estate NewsJul 05, 2024
The demerger proposal, which was approved by the board, entails the issuance of one equity share of Raymond Realty Limited to every shareholder of Raymond Ltd. The new entity, Raymond Realty Limited, will be listed on the Bombay Stock Exchange (BSE) and National Stock Exchange of India (NSE).
Raymond Ltd's shares reached a 52-week high of ₹3,484 per share on the BSE, with over 2.41 lakh shares being traded. The company has stated that the demerger is a strategic move, as the real estate business has reached a significant size and is well-positioned to chart its own growth path as a distinct firm.
In the fiscal year 2024, the realty business saw an impressive 43% increase in revenue, reaching ₹1,593 Crore. The EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) of the business totaled ₹370 Crore.
Raymond Ltd has noted that the demerger will enable the company to focus on its core business operations, including its investments in the engineering business and a denim joint venture. The demerger is expected to benefit both companies, with Raymond Realty Limited set to become a pure-play listed real estate organization.
The company's shares were trading 11.27% higher at ₹3,271.25 per piece on the NSE, with an intraday high and low of ₹3,484 and ₹3,004.30, respectively.
Raymond Ltd is a leading Indian textile and fabric manufacturer, with a rich history spanning over 90 years. The company is known for its high-quality fabrics, fashion apparel, and textile innovation.
Raymond Realty Limited is a new entity established as a result of the demerger of Raymond Ltd's real estate business. The company will be listed on the BSE and NSE, with a focus on real estate development and operations.
Frequently Asked Questions
What is the reason behind Raymond Ltd's demerger of its real estate business?
The demerger is a strategic move, as the real estate business has reached a significant size and is well-positioned to chart its own growth path as a distinct firm.
What will happen to Raymond Ltd's shares post-demerger?
Raymond Ltd shareholders will receive one equity share of Raymond Realty Limited for every share they own in the textile company.
How will the demerger benefit Raymond Ltd?
The demerger will enable Raymond Ltd to focus on its core business operations, including its investments in the engineering business and a denim joint venture.
What is the financial performance of Raymond Ltd's realty business?
In FY24, the realty business saw a 43% increase in revenue, reaching ₹1,593 Crore, with an EBITDA of ₹370 Crore.
What is Raymond Realty Limited?
Raymond Realty Limited is a new entity established as a result of the demerger of Raymond Ltd's real estate business, which will be listed on the BSE and NSE.
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