Hold Raymond; target of Rs 450: Sharekhan

Trade

• Watchlist
• Portfolio
• Message
• Set Alert

 

 

Choose Stock Exchange: BSE LIVE NSE LIVE

26 Aug, 2025 12:21

Volume

Todays L/H

More

×

Sharekhan's research report on RaymondRaymond’s consolidated top line grew at 7.3% YoY. Barring apparels segment, which grew at strong 24.7% YoY, other businesses posted muted performance. Weak revenue profile, with increasing expenses (primarily ad and promotion cost increased by 26% YoY) resulted in a 12.5% decline in operating profit, which translated into a sharper 25.8% decline at the net level on an adjusted basis. The quarterly performance also included the effect of an exceptional cost of Rs 19 crore during the quarter towards enhancement in the minimum bonus limit effective from April 1, 2014, along with Rs 3 crore provision towards the disposed-off forging business.Despite weak Q3 performance on the profitability front, we believe that Raymond’s efforts towards stepping up its brands, and distribution network augurs well towards creating a profitable branded play in the next few quarters once the investment start yielding results along with improvement in the macro environment. Thus, we continue to like the medium-to-long term brand franchisee of Raymond which coupled with the brand play and the embedded real estate value in the stock makes us maintain our Hold rating on the stock, with a price target to Rs 450 (based on an SOTP-based valuation, the core business is valued at 18x its FY2017E + 50% value of the land parcel). Any development on the value unlocking front through divestment of the noncore assets (monetisation of the land parcel, stake sale in engineering and automotive subsidiaries) would be positive.For all recommendations, click here Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

Read More