Raymond stock 'ready for takeoff', says Antique; cites these triggers

Shares of Raymond rose by as much as 2% on Friday, July 18, following a favourable outlook from Antique Stock Broking. The brokerage firm assigned a 'Buy' rating with a target price of Rs 903 per share, suggesting a potential upside of 30% from the last closing level. Antique labelled the stock as 'ready for takeoff' due to Raymond's strategic transformation. This transformation includes the demerger and listing of its Fabric and Realty businesses and ventures into precision manufacturing for automotive and aerospace sectors.

Raymond shares gained 2% to Rs 710. 60 on Friday. Market cap of the firm stood at Rs  696.55 on BSE.  

Raymond's current restructuring has resulted in three main business areas: Automotive Components, Engineering Tools, and Aerospace. The company plans to further establish two specialised subsidiaries, one aimed at defence and aerospace, and the other towards auto components, electric vehicles, and engineering consumables.

These strategic moves are expected to bolster its market position significantly. Antique projects the company's revenue, EBITDA, and profit to grow at rates of 16%, 38%, and 55% annually, with operating margins expected to improve to 15.3% by FY28.

The company's focus on expanding its presence in high-growth areas such as defence and aerospace is seen as a key factor contributing to its optimistic financial projections.

Antique's coverage reinforces confidence in Raymond's strategic direction, which is poised to leverage structural tailwinds in its targeted sectors. This development paints a promising picture for stakeholders, as the company's transformative efforts align with industry trends indicating robust growth potential.

Furthermore, the anticipated growth in the electric vehicle sector presents additional opportunities for Raymond's auto components business, potentially driving further revenue increases. Additionally, the company's commitment to innovation and adaptation in these sectors is expected to enhance its competitive edge and ensure sustained growth.