Raymond stock snaps 7-day losing streak, rises 7.5%

Shares of Raymond witnessed a sharp rally on Wednesday's intra-day trade after declining steadily for the last seven trading sessions. The stock started the trading session strongly at ₹1,419.9 apiece and eventually rose to hit an intraday high of ₹1,517, up 7.55 percent against the previous closing price of Rs.1,410.5. 

At 1:45 p.m., the stock was trading at around ₹1,485, up by 5.41 percent, on the BSE.

The stock got off to a great start in 2022, rising 37.50 percent in the first three months. It largely kept up the momentum to reach an all-time high of ₹1,630 apiece on December 2.

The stock has risen by nearly 23 percent since the announcement of its second-quarter results. The stock has been on an upward trend for the past three months.

In the past one year, the stock has generated a massive return of 126.59 percent, as against a 7.62 percent rise in the benchmark Nifty50. YTD, the stock has risen from around Rs. 621.55 level to the current trading price of Rs. 1,485, representing a 138.91 percent increase.

With its one-year performance, the stock also piqued the interest of foreign investors. FIIs have raised their holdings to 15 percent in the September quarter, compared to 7.3 percent in the same quarter of last year, Trendlyne data showed.

The stock has a price-to-earnings (P/E) multiple of 16.37x, much lower than its sector PE of 54.19x, while the stock EPS was ₹90.63 and the price-to-book value ratio stood at 3.54x.

Raymond is a small-cap stock with a market capitalisation of over Rs. 9,898 crore. The company is engaged in numerous businesses and has a portfolio of well-known brands in textiles, apparel, denim, consumer care, engineering, and real estate.

For the September quarter, the company reported a nearly three-fold jump in its consolidated net profit at ₹161.95 crore on the back of strong sales supported by the festival boost. The company had posted a net profit of ₹56.15 crore during the July-September quarter of the previous fiscal.

The company's revenue from operations in Q2 rose 39.78 percent to ₹2,168 crore from ₹1,551 crore in the corresponding quarter of the previous fiscal. Meanwhile, the high raw material costs have pushed the company's overall expenses in the September quarter to ₹1,833.3 crore, an increase of about 33.18 percent YoY.

Raymond's net debt had been reduced to ₹1,286 crore as of September 30, 2022, helped by free-cash-flow generation, the company said in an earnings statement.

According to a MintGenie poll, two analysts on average have a strong 'buy' call on the stock.

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of MintGenie.