RAYMONDLSL - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 2.5
| Stock Code | RAYMONDLSL | Market Cap | 5,766 Cr. | Current Price | 945 ₹ | High / Low | 1,998 ₹ |
| Stock P/E | 99.7 | Book Value | 1,567 ₹ | Dividend Yield | 0.00 % | ROCE | 2.10 % |
| ROE | 0.50 % | Face Value | 2.00 ₹ | DMA 50 | 1,061 ₹ | DMA 200 | 1,235 ₹ |
| Chg in FII Hold | 0.19 % | Chg in DII Hold | -0.37 % | PAT Qtr | 68.6 Cr. | PAT Prev Qtr | -1.65 Cr. |
| RSI | 33.4 | MACD | -35.4 | Volume | 66,018 | Avg Vol 1Wk | 77,227 |
| Low price | 860 ₹ | High price | 1,998 ₹ | PEG Ratio | 2.72 | Debt to equity | 0.22 |
| 52w Index | 7.49 % | Qtr Profit Var | -11.4 % | EPS | 8.58 ₹ | Industry PE | 20.1 |
📊 Financials: Raymond LSL shows weak profitability with EPS at 8.58 ₹. ROE of 0.50% and ROCE of 2.10% are very low, indicating poor efficiency in capital utilization. Debt-to-equity at 0.22 is manageable, reflecting a relatively healthy balance sheet. Quarterly PAT improved to 68.6 Cr. from a loss of -1.65 Cr., but profit variation (-11.4%) highlights inconsistency in earnings momentum.
💹 Valuation: Current P/E of 99.7 is far above the industry average of 20.1, suggesting extreme overvaluation. Book Value of 1,567 ₹ gives a P/B ratio of ~0.60, which looks cheap but is misleading due to weak profitability. PEG ratio of 2.72 highlights poor earnings growth relative to valuation. Intrinsic value appears lower than current market price, making the stock stretched.
🏢 Business Model & Health: Raymond LSL operates in textiles and lifestyle products, benefiting from brand recognition and diversified offerings. Competitive advantage lies in brand heritage and distribution reach. However, profitability collapse and weak return ratios undermine overall health. Balance sheet leverage is low, but earnings volatility remains a concern.
🎯 Entry Zone: Current price of 945 ₹ is near its lower range (860 ₹) but far below its 52-week high (1,998 ₹). RSI at 33.4 suggests oversold conditions, indicating potential for a technical rebound. A safer entry zone would be around 880–920 ₹, closer to support levels, offering better risk-reward.
📈 Long-Term Holding Guidance: Raymond LSL 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.
- 📊 Manageable debt-to-equity ratio (0.22).
- 📉 RSI near oversold levels, potential for short-term rebound.
Limitation
- ⚠️ Extremely high P/E ratio (99.7) vs industry average (20.1).
- 📉 Weak ROE (0.50%) and ROCE (2.10%).
- 📊 Quarterly profit variation (-11.4%) shows inconsistency.
- 💸 No dividend yield (0.00%).
Company Negative News
- 📉 Decline in DII holdings (-0.37%).
- ⚠️ Weak return metrics compared to peers.
Company Positive News
- 📈 Increase in FII holdings (+0.19%).
- 💹 PAT recovery from previous quarter’s loss.
Industry
- 👔 Textile and lifestyle sector supported by consumer demand and brand-driven growth.
- 📊 Industry PE at 20.1, highlighting Raymond LSL’s extreme premium valuation multiples.
Conclusion
⚖️ Raymond LSL faces profitability challenges and extreme valuations despite brand strength. Entry is advisable only around 880–920 ₹ 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 and V-Mart to highlight Raymond LSL’s relative position in the sector?