RAYMOND - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 2.6
| Stock Code | RAYMOND | Market Cap | 2,630 Cr. | Current Price | 395 ₹ | High / Low | 784 ₹ |
| Stock P/E | 64.7 | Book Value | 296 ₹ | Dividend Yield | 0.00 % | ROCE | 1.17 % |
| ROE | 294 % | Face Value | 10.0 ₹ | DMA 50 | 461 ₹ | DMA 200 | 539 ₹ |
| Chg in FII Hold | -0.18 % | Chg in DII Hold | -1.27 % | PAT Qtr | -2.85 Cr. | PAT Prev Qtr | 11.8 Cr. |
| RSI | 25.7 | MACD | -16.7 | Volume | 2,44,589 | Avg Vol 1Wk | 2,19,580 |
| Low price | 394 ₹ | High price | 784 ₹ | PEG Ratio | 0.38 | Debt to equity | 0.00 |
| 52w Index | 0.32 % | Qtr Profit Var | -122 % | EPS | 822 ₹ | Industry PE | 33.3 |
📊 Financials: Raymond shows highly volatile earnings with EPS at 822 ₹, but quarterly PAT slipped into a loss (-2.85 Cr. vs 11.8 Cr. previously). ROE appears inflated at 294% due to accounting anomalies, while ROCE at 1.17% reflects poor efficiency. Debt-to-equity is 0.00, indicating a debt-free balance sheet. Overall profitability is inconsistent, raising concerns about sustainability.
💹 Valuation: Current P/E of 64.7 is nearly double the industry average of 33.3, suggesting overvaluation. Book Value of 296 ₹ gives a P/B ratio of ~1.33, which is fair. PEG ratio of 0.38 indicates some growth potential, but earnings volatility undermines valuation comfort. Intrinsic value appears lower than current market price, making the stock stretched.
🏢 Business Model & Health: Raymond operates in textiles and lifestyle products, leveraging brand heritage and diversified offerings. Competitive advantage lies in brand recognition and distribution reach. However, profitability collapse and weak return ratios undermine overall health. Despite being debt-free, earnings volatility and valuation risks weigh heavily.
🎯 Entry Zone: Current price of 395 ₹ is near its 52-week low (394 ₹), far below its high (784 ₹). RSI at 25.7 suggests oversold conditions, indicating potential for a technical rebound. A safer entry zone would be around 370–390 ₹, offering better risk-reward balance.
📈 Long-Term Holding Guidance: Raymond is risky for long-term holding given weak profitability and stretched valuations. Investors should wait for consistent earnings recovery before considering accumulation. Current fundamentals do not justify aggressive long-term exposure.
Positive
- 🏢 Strong brand presence in textiles and lifestyle products.
- 📊 Debt-free balance sheet (Debt-to-equity 0.00).
- 📉 RSI near oversold levels, potential for short-term rebound.
Limitation
- ⚠️ Extremely high P/E ratio (64.7) vs industry average (33.3).
- 📉 Weak ROCE (1.17%) and volatile ROE (294%).
- 📊 Quarterly PAT slipped into losses (-2.85 Cr.).
- 💸 No dividend yield (0.00%).
Company Negative News
- 📉 Decline in FII holdings (-0.18%).
- ⚠️ Reduction in DII holdings (-1.27%).
- 📊 Profitability collapse with quarterly losses.
Company Positive News
- 📈 Debt-free status provides financial stability.
- 💹 Strong brand heritage and diversified product portfolio.
Industry
- 👔 Textile and lifestyle sector supported by consumer demand and brand-driven growth.
- 📊 Industry PE at 33.3, highlighting Raymond’s premium valuation multiples.
Conclusion
⚖️ Raymond faces profitability challenges and extreme valuations despite brand strength and debt-free status. Entry is advisable only around 370–390 ₹ with caution. Long-term investors should wait for earnings recovery and improved return ratios before committing heavily.
Would you like me to also prepare a peer comparison with other textile and lifestyle companies like Arvind, V-Mart, and Page Industries to highlight Raymond’s relative position in the sector?