Raymond surges 5% after lifestyle business demerger

economictimes.indiatimes.com:

Shares of Raymond surged 5% to ₹2,001 on the NSE on Thursday after the demerger of its lifestyle business took effect. The company had set Thursday as the record date for the demerger. The demerged entity, Raymond Lifestyle, is expected to be listed separately in a month or two, according to analysts.

As part of the group restructuring process, Raymond demerged its lifestyle business into a separate company. Raymond shareholders will receive four equity shares of Raymond Lifestyle for every five shares held in Raymond.

Shares of Raymond have rallied 83% so far this year, compared to an 18% gain in the benchmark Nifty 500.

Last week, Raymond also announced the demerger of its real estate business into a separate company, Raymond Realty. The Raymond Group will now have three listed entities — Lifestyle, Real Estate, and the current entity (engineering).

InCred Equities in a report said that Raymond Lifestyle is expected to be listed by the end of August or early September, while the demerger of the real estate business is expected to take 12-15 months to complete.

Motilal Oswal Financial Services has valued the real estate business at ₹1,200 per share, the engineering business at ₹215 per share, and the lifestyle business at ₹2,340 per share. The combined value of the three businesses works out to be ₹3,755 per share.