Raymond Ltd aims to achieve high growth in real estate business, with the board givingan in-principle approval for subsidiarisation of real estate business division through a wholly-owned subsidiary.
Fabrics and garments major Raymond Ltd on Monday announced that its board approved a consolidation practice, encompassing the assortment of its tools and hardware, and auto components businesses with its engineering venture to improve synergies and explore monetisation options. Moreover, the board has further approved consolidation of its B2C venture through transfer of apparel business into Raymond Ltd, the company said in a statement.
Commenting on the development, Raymond Ltd Chairman and Managing Director Gautam Hari Singhania mentioned how the company’s engineering business comprising tools and hardware, and auto components has demonstrated good performance. According to him, it’s speeding to shine bright in the futureas well.
“We are consolidating the business to explore all options available to us for monetisation, which will enable deleveraging leading to value creation,” he said. “With a focus to fast track the recovery post pandemic Raymond will consolidate its B2C business through transfer of apparel business into Raymond Ltd,” he added.
It will be carried out by demonstrating the B2C business, encompassing apparels, of Raymond Apparel Ltd. (RAL), a wholly-owned subsidiary, on a going concern basis to merge with the company itself.
Raymond believes that this move will strengthen efficiencies, streamline and simplify processes and bring in synergy benefits in terms of design and innovation, sourcing and retail network.
In order to enable and execute the above decisions, the company said it has “withdrawn the demerger scheme of lifestyle business announced in November, 2019. These actions will enable each of the businesses for monetization which will fuel growth and deleveraging.”
Singhania mentioned that the giant continues to focus on its B2C business by bringing in-operational efficiencies and synergies in order to strengthen the lifestyle business.
Raymond Ltd. aims to achieve the high growth momentum in real estate business with the board giving an in-principle approval for subsidiarisation of real estate business division through a wholly-owned subsidiary.
Launched in 2019 with the development of land in Thane, Raymond said its real estate business is now “poised for growth with a focus on delivering a value-based offering”.
The company has said that it plans to capitalise on its strengths by extending in ventures. Its real estate division is a sustainable profitable business led by an experienced professional team with a clear long term strategy in place.
It is said to deliver around 3 million sq ft of residential projects. It has already achieved sales of over 70 per cent of launched inventory of around 2 million sq ft, it added.
“In order to realise its full potential it will now be a wholly-owned subsidiary of Raymond Ltd.” said Singhania stating that the realty business has showcased good performance since its launch.