Raymond Ltd. is strategically pivoting towards its real estate business while exploring opportunities in the aerospace and defence sectors, as indicated by Group Chief Financial Officer Amit Agarwal.
The company’s recent financial performance showcases a robust recovery, with consolidated net profit soaring 26.7% year-on-year to Rs 57 crore for the first quarter of fiscal 2025, significantly bolstered by nearly doubling revenue from operations compared to Rs 45 crore during the same period last year.
A pivotal change for the company occurred with the demerger of its lifestyle business into Raymond Lifestyle Ltd., which was finalized on June 30. This strategic move is expected to allow Raymond to sharpen its focus on its core areas of growth.
Agarwal elaborated on the company’s ambitious plans for its real estate segment, outlining a 'build fast, sell fast, and collect fast' strategy. Currently, Raymond is engaged in developing a 100-acre parcel in Thane and is involved in a joint development agreement in Bandra, Mumbai.
"We have seen an overwhelming response in sales bookings, with over Rs 600 crore in sales recorded in the first quarter. We are on track to achieve Rs 4,000 crore in sales bookings within the next 3 to 4 years," he stated.
In addition to real estate, Agarwal highlighted the significant growth potential in Raymond’s engineering division, particularly within the aerospace and defence sectors.
“India currently accounts for just 1% of the $100 billion aerospace and defence market. We believe there is a substantial opportunity for growth, as the country is poised to increase this share to 2-3%,” he remarked.
Raymond's recent acquisition of a 59.25% stake in Maini Precision Products Ltd., which specialises in components for the engineering, automotive, electric vehicle, aerospace, and defence industries, aligns with this strategy.
Despite experiencing a slowdown in the lifestyle segment, Agarwal expressed optimism for a rebound in the latter part of the year, driven by upcoming weddings and festivals. "In the lifestyle business, we are building on a robust long-term goal.
In the first quarter, there was excessive heat, and there were no weddings. People were also busy due to elections, resulting in reduced shopping activity, compounded by inflationary pressures," he explained. Revenue from the lifestyle segment declined by 8%, with textiles experiencing an 18% drop during Q1.
Addressing the political crisis in Bangladesh, Agarwal noted that the company is poised to capitalise on potential business opportunities arising from the situation. “This crisis enables us to become much more agile, quickly adapt, and attract new customers,” he commented.
Notably, Bangladesh is currently the world’s second-largest textile exporter, trailing only China, according to Bloomberg data.
Raymond's shares closed flat at Rs 1,936 apiece, dipping 0.06% on the BSE, in contrast to a 1.27% gain in the NSE Nifty 50.
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