Raymond's stock rose from a low of Rs. 505.90 to Rs. 1,296.50 in a year, yielding a multi-bagger return of 150%. The stock has been on a bull run since the start of the year, and in the previous trading session, it hit an all-time high of Rs. 1,329.9, surpassing its previous all-time high of Rs. 1,278 set on June 02. YTD, the stock has risen from around Rs. 621.95 to the current trading price of Rs. 1,295.50, representing a 102.21% increase.
At the time of writing, the stock had a price-to-earnings (P/E) multiple of 14.07x much lower than its sector PE of 59.86x The EPS was ₹74.77, while the price-to-book value ratio stood at ₹3.54x.
Raymond is a small-cap stock with a market capitalization of over Rs. 8,631 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.
On November 03, Raymond reported a nearly three-fold jump in its consolidated net profit to ₹161.95 crore in the September-ending quarter as a result 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 39.76% to ₹2,168 crore from ₹1,551 crore in the corresponding quarter of the previous fiscal. During the September quarter, Raymond's revenue from textiles stood at ₹911.80 crore and ₹210.52 crore from the 'shirting' segment. The revenue from the apparel segment came in at ₹370 crore and ₹265.51 crore from the garmenting segment. while the revenue from tools and hardware was ₹132.33 crore and ₹95.31 crore from auto components.
On the other hand, the company's revenue from real estate and the development of property jumped over three-fold in the September quarter to ₹247.45 crore against ₹81.11 crore in the September 2021 quarter.
"The real estate sector witnessed sustained demand from home buyers that contributed to growth in our realty business with varied product offerings," the company said.
Meanwhile, the high raw material costs have pushed the company's overall expenses in the September ending quarter to ₹1,833.3 crore, an increase of about 33.18 YoY.
The company reported an operating profit of ₹335 crore in Q2 FY23, an increase of 33.29% when compared to ₹180.9 crore from the same quarter of the last fiscal. EBITDA margin came in at 15.45%, up by 379 basis points (bps) from the same quarter last year.
Raymond's net debt had been reduced to ₹1,286 crore as of September 30, 2022, helped by free-cash-flow generation, Raymond said in an earnings statement.
"However, there was an increase in working capital deployment, primarily in production and sales, to meet strong festive and winter wedding demand in H2," Raymond said.
Raymond's Chairman and Managing Director, Gautam Hari Singhania, said the group's businesses are delivering consistent growth in both revenues and profitability on a quarter-on-quarter basis.
With its one-year performance, the stock also piqued the interest of foreign investors. FIIs have raised their holdings to 15% in the September quarter compared to 7.3% in the same quarter of last year.
An average of 02 analysts polled by MintGenie 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.
