Shares of Raymond Ltd experienced a steep decline of over 64% on May 14, 2025, closing at ₹556.45, down from ₹1,561.30 the previous day. The sudden drop in raymond share price is linked to the company’s recent move to demerge its real estate business, Raymond Realty, which has now become an independent entity. This significant price adjustment is part of the standard procedure during a demerger, where the valuation of the newly separated entity is excluded from the parent company’s raymond share price.
The Demerger Explained
On May 1, 2025, Raymond Ltd officially demerged its real estate arm, Raymond Realty, marking a critical milestone in the company’s strategic restructuring. Under the demerger scheme, shareholders of Raymond Ltd received one share of Raymond Realty for every share they held in Raymond Ltd. The stock’s ex-date for this demerger was May 14, 2025. This move aims to create two distinct entities: Raymond Ltd, focused on its textile and branded apparel business, and Raymond Realty, focusing solely on real estate development.
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The reduction in raymond share price on May 14 reflects the exclusion of Raymond Realty’s market value from Raymond Ltd’s stock. Essentially, the drop is a notional adjustment, not a reflection of the actual loss in shareholder value, as investors are now holding shares in both Raymond Ltd and Raymond Realty.
Performance of Raymond Realty
Raymond Realty, the newly-formed real estate arm, has shown solid financial growth, particularly in its Q4 FY25 results. The company’s revenue for the quarter surged by 13% year-on-year, reaching ₹766 crore, while its EBITDA (earnings before interest, taxes, depreciation, and amortization) improved to ₹194 crore, with margins expanding to 25.3%. Additionally, the company signed two new joint development agreements (JDAs), which are expected to boost its growth prospects.
Raymond Realty’s decision to focus on real estate development is expected to unlock significant value for shareholders in the future. The company is strategically positioned for long-term growth in the real estate sector, especially in light of its ongoing projects and market expansion.
Future Outlook for Both Entities
Raymond Realty is expected to be listed on the stock exchanges by the second quarter of fiscal year 2026 (Q2 FY26), giving investors more clarity on the financials and performance of the newly separated entity. This listing will allow Raymond Realty to unlock its value as an independent company, potentially attracting new investors and providing existing shareholders with a clearer picture of its future prospects.
For Raymond Ltd, the demerger allows the company to concentrate more on its core textile and branded apparel businesses. This focus could enhance its ability to generate value from its established brand reputation and market leadership in the clothing sector.
What Investors Should Know
While the sharp fall in raymond share price may seem alarming, investors should view the price drop as a temporary adjustment tied to the structural changes brought about by the demerger. The separation of Raymond Realty is designed to unlock value for both entities and their shareholders over time.
With Raymond Realty’s positive performance and potential future growth in real estate development, alongside Raymond Ltd’s strong position in the apparel industry, both companies are expected to offer investors attractive opportunities moving forward.
For those concerned about the raymond share price and future returns, it’s essential to understand that this demerger marks the beginning of a new phase for both Raymond Ltd and Raymond Realty. Investors should keep an eye on the upcoming listing of Raymond Realty and any further developments in both companies’ respective businesses.
