Gautam Singhania, chairman of Raymond, on Tuesday said the conglomerate in 2020 laid a roadmap to restructure it and build it across verticals. He said the conglomerate has created a healthier balance sheet and now it is eyeing the next chapter of expansion.
"In 2020, we laid down a bold roadmap for Raymond—a 7-year plan to redefine our company’s future. The journey is far from over, but the vision remains clear: to consistently create shareholder value & take Raymond to the next level... Today, with a healthier balance sheet, Raymond is executing the next chapter from its playbook: Expansion," Singhania wrote on X (formerly Twitter).
The 99-year-old group has a presence in three district verticals - lifestyle products (textiles and apparels), engineering products, and real estate. Singhania noted that the business will have three verticals: Raymond Lifestyle, Raymond engineering products, and Raymond Realty.
He said: "The idea is to—be among the top three companies in all businesses, exit those where they couldn’t be among the top three, reduce debt, & de-merge the conglomerate once debt is under control."
Giving a sneak peak into his demerger plan, Singhania noted:
1. Raymond Lifestyle sees great potential in making garments in the Western markets. We're ramping up our manufacturing capacity from 8 million to 11 million garments annually, with an expanded store footprint & new categories like men's innerwear and sleepwear, & relying on core – suiting fabrics business.
2. Evolving our product range from traditional files and gears- Raymond's now innovating with components for aerospace, defence, & electric vehicles.
3. Raymond Realty is leveraging its 100-acre Thane land parcel and exploring new opportunities through joint development agreements in Mumbai to diversify the business.
It is to be noted that in July, Singhania said that the National Company Law Tribunal (NCLT) had approved Raymond’s composite scheme of arrangement and restructuring involving the demerger of its lifestyle business and the amalgamation of its consumer trading arm, paving way for a more focused and streamlined corporate structure.
He said that obtaining approval is a vital milestone in the journey to create a more sophisticated and effective corporate structure for the Raymond group. This progression involves separating Raymond Ltd and Raymond Lifestyle, in addition to establishing Ray Global Consumer Trading. Shareholders can expect to receive equity shares based on the swap ratio as part of the reorganization procedure.
"We have achieved a significant milestone in Raymond Group’s journey as the National Company Law Tribunal (NCLT) approves our strategic demerger and amalgamation, marking a new chapter of growth & opportunity for us.. This means a fresh, focused corporate structure is on the horizon," Singhania posted on X.
After the restructuring, shareholders of Raymond Ltd will receive four equity shares of Raymond Lifestyle for every five shares held in Raymond Ltd.
Besides, Ray Global Consumer Trading shareholders will get 2 equity shares of Raymond Lifestyle for each share held in Ray Global Consumer Trading. Equity shares of Raymond Lifestyle will be listed on the stock exchanges shortly.
The company in its petition to the NCLT Mumbai bench said that its primary objective is to unlock the potential value of Raymond’s distinct business verticals. The petitions emphasized the notable expansion of the textile and lifestyle segments, indicating the need for separate management and operations. The division aims to facilitate dedicated oversight of each business vertical, optimize operational connections, and simplify the corporate framework.