EduInvesting.in | May 15, 2025

If you opened your brokerage app and saw Raymond Ltd down 66%, you probably dropped your phone faster than they dropped trousers in their 90s ads.

But relax. This isn’t a crash. It’s a corporate detox. Raymond didn’t lose ₹1,000 in value overnight. It simply shed some weight — in the form of real estate.

Welcome to the world of demergers — where stocks get a glow-up by breaking up.

🧾 What Just Happened?

Raymond Ltd, the textile-to-everything conglomerate, officially spun off its real estate arm, Raymond Realty, on May 14, 2025.

• Shareholders received 1 share of Raymond Realty for every 1 share of Raymond Ltd.
• The stock price adjusted from ₹1,561 to ₹530, reflecting the removal of the realty business.
• People panicked anyway, because maths is hard.

So yes — the “66% crash” is not a real loss, it’s a technical adjustment. Just like when your salary looks smaller after tax — but your net worth’s unchanged (unless you bought crypto).

🏗️ What’s This Raymond Realty Hype?

Turns out, Raymond isn’t just good with suits — it’s also been killing it in skyscrapers.

• Q4 FY25 revenue: ₹766 crore
• EBITDA: ₹194 crore (25.3% margin)
• Total development pipeline: ~₹40,000 crore
  • ₹25,000 crore from its Thane mega-land
  • ₹14,000 crore from Mahim, Bandra, Wadala via JDAs

If you ever saw a massive tower next to Raymond’s factory in Thane and thought, “Is this a fashion empire or a city-state?” — you weren’t wrong.

📉 Why the Crash Looked So Scary

Because:

• The price dropped.
• People didn’t read.
• Financial literacy continues to be underfunded.

When a company demerges a profitable arm, its stock price reflects the smaller, remaining business. You didn’t lose value — you just got two stocks now.

It’s like if a pizza joint spun off its garlic bread business — your portfolio now has both carbs.

📊 The Math Behind the Meltdown

So, the ₹1,561 you had yesterday? Still worth roughly ₹1,561 today — just split across two companies.

Investors love to panic first and Google later. Don’t be that guy.

💼 Why Raymond Did This

Because conglomerates are out, focused verticals are in.

This isn’t Raymond’s first breakup:

• 2024: Lifestyle division demerged as Raymond Lifestyle
• 2025: Realty demerged
• Next up: Engineering business will go solo too

This strategy:

• Unlocks shareholder value
• Simplifies balance sheets
• Helps each business get its own valuation party

Basically, Gautam Singhania said, “Let’s stop being a buffet and start being gourmet.” Respect.

🧠 EduInterpretation: So What Should You Do?

• If you held Raymond shares on May 14, congrats — you now hold two entities.
• Raymond Ltd (post-demerger) = Textile, FMCG, engineering
• Raymond Realty (coming soon to NSE/BSE) = Pure-play real estate

Once Realty gets listed, you can trade both independently, depending on what excites you more: suits or skyscrapers.

Long-term? Both businesses have strong balance sheets, no scandalous debt, and decent growth visibility.

📈 The Market Reaction

After dropping to ₹530, Raymond Ltd hit upper circuit at ₹556.45, because once people understood what actually happened, they hit “Buy” faster than you hit snooze.

🧠 EduFinal Word:

This wasn’t a crash. This was corporate reengineering in action.

Raymond Ltd is no longer a confused empire of blazers and buildings. It’s becoming a leaner, focused machine, splitting into precise verticals — all of which are profitable.

Moral of the story?

📉 A falling stock price doesn’t always mean value destruction.
📊 Read before you react.
🧠 And maybe… learn what a demerger actually is.