Lucknow Press
Before the budget, the Indian stock market is witnessing a decline. After Wednesday, the Sensex is witnessing a decline on Thursday as well. This is the second consecutive day of decline in the stock market.
On Thursday morning, Raymond company’s stock saw a big drop at the beginning of the trading session and the stock fell by more than 40 percent to Rs 1852. This decline in Raymond’s stock was seen after the decision to separate the lifestyle business.
For every five shares, you will get four shares of Raymond Lifestyle
The separated business will be listed separately on the stock exchange around August-September. Existing Raymond investors will get four shares of Raymond Lifestyle for every five shares of Raymond they hold. Today is the record date for this allotment. Today the price of Raymond shares is low because today is the record date after which the decision to separate the lifestyle business will be taken. This means that now only the core business of Raymond company is left and the lifestyle business has been separated.
After the initial decline,
there was a slight increase in the price of Raymond’s stock. The price of one share reached Rs 2,009.80 with a rise of 3.07% from the initial price. Some brokerage firms expect that after this change, the share of Raymond Limited will fall to around Rs 1,415. This included Rs 1200 for real estate business and Rs 215 for engineering business. They said that the lifestyle business can be listed at a price of Rs 2,930 per share.
Separating the business is the company’s major planning.
Brokerage firm InCred Equities has estimated that the correct price of the lifestyle business is Rs 1982 per share, real estate is Rs 1086 and engineering is Rs 499 per share. Separating the lifestyle business is being said to be a part of the company’s major planning. Raymond is also thinking of separating its real estate business. This entire process may take 15-18 months. After this, only the engineering business will remain in the Raymond company.
For every 1 Raymond share
Getting 1 share of real estate and 1 share of lifestyle business is 4:5, i.e. for every 5 Raymond shares, you will get 4 shares of lifestyle company. For real estate, the ratio is 1:1, i.e. for every 1 Raymond share, you will get 1 share of real estate. Arihant Capital Markets says that this step has been taken to create three separate businesses so that the company can make more profit. For Raymond’s real estate, he said that there is 100 acres of land in Thane. Work is going on on 40 acres of it. It is expected to generate a revenue of about 9,000 crores in 8 years. By including the remaining 60 acres of land, a profit of 25,000 crores can be made in 8 years.
Arihant Capital also said that the company has prepared a plan of revenue of 7,000 crores in collaboration with some other companies (JDA). This profit can be obtained in the next 4-5 years. The company has 500 crores in cash for the real estate business and they do not need to invest much money in the next two years. In the next three years, the real estate business can earn 4,000 crores annually and their margin (EBITDA) is estimated to be around 25%.
