Raymond shares surge ~18% on realty business demerger

5 Jul 2024 , 02:35 PM

Raymond Ltd shares rose more than 18% to a year high on Friday, July 5, after the textile and fabric manufacturer announced a major restructuring step.

The company disclosed in an exchange filing that its board has approved the demerger of its real estate operations into a new entity, Raymond Realty Ltd.

According to the demerger proposal, Raymond Ltd shareholders would receive one equity share of Raymond Realty for every share they own in the textile company.

Raymond Realty will be listed on the BSE and NSE.

Raymond Ltd shares reached a 52-week high of ₹3,484 per share on the BSE. More than 2.41 lakh shares were traded on the BSE.

On Thursday, the corporate board approved the demerger of the real estate business into a wholly-owned subsidiary Raymond Realty Limited (RRL), and the automatic listing of the newly established company. RRL would issue 66,573,731 shares with a face value of ₹10 apiece to Raymond Ltd owners.

Raymond Realty would be a pure play-listed real estate organisation, while Raymond Ltd would be a company having investments in the engineering business and a denim joint venture.

Raymond Ltd noted that the strategic demerger occurred as the real estate business reached size and was well positioned to chart its own growth path as a distinct firm.

In FY24, the realty business saw a 43% increase in revenue, reaching ₹1,593 Crore over the previous year. The EBITDA totaled ₹370 Crore.

At around 2.29 PM, Raymond was trading 11.27% higher at ₹3,271.25 per piece, against the previous close of ₹2,940.05 on NSE. The counter touched an intraday high and low of ₹3,484, and ₹3,004.30, respectively.

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