Raymond Realty shares to list on exchanges today. What to expect?
Raymond Realty
Ltd (RRL) are set to list on the stock exchanges today, July 1, following its demerger from Raymond. The company, which has emerged as a focused
real estate
player within the group, is getting independently listed for the first time, unlocking value for shareholders and enabling investors to gain direct exposure to its real estate operations.
As per the terms of the demerger, every shareholder of
Raymond Ltd
has received one share of
Raymond Realty
for every share held.
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Brokerages are optimistic about Raymond Realty's listing prospects. Ventura Securities has pegged a FY28 DCF-based target price of Rs 1,383 per share, while SBI Securities expects the listing price to be in the range of Rs 897 to Rs 1,430, depending on the valuation multiple assigned by the market.
The firm is likely to list at a FY26E EV/EBITDA multiple of 11–15x, and with an expected EBITDA growth of 0–20% over FY25, SBI Securities has assigned a base case fair value of Rs 1,148 per share, assuming 10% YoY EBITDA growth in FY26 and a 13x EV/EBITDA multiple.
These valuations are benchmarked against peers such as Arkade Developers, Keystone Realtors, and Sunteck Realty, which currently trade at an average EV/EBITDA multiple of 17x.
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Raymond Realty's operations are centered around a 100-acre land parcel in Thane. Of this, approximately 40 acres are currently under development with a carpet area of 4 million sq ft, having a revenue potential of around Rs 9,000 crore.
The remaining 60 acres are expected to be developed over the next 6–8 years, with a projected carpet area of 7 million sq ft and an estimated revenue potential of Rs 16,000 crore. The total GDV of the Thane land bank is thus pegged at Rs 25,000 crore.
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In addition to its Thane projects, the company has signed six Joint Development Agreements (JDAs) across key locations in Mumbai including Bandra, Mahim, Sion, and Wadala. The estimated revenue potential from these JDA projects is Rs 14,000 crore.
Under the JDA model, RRL is not required to invest in land acquisition and only manages the construction and execution, thereby keeping its balance sheet light.
Going forward, around 40–45% of revenues are expected to come from JDAs over the next 7 years, increasing to nearly 70% in the long term. In FY26, the company plans to launch two new projects on its own land in Thane and four new projects under the JDA model. Over the next 3–4 years, JDA projects are expected to contribute nearly half of the company's pre-sales.
Raymond Realty financial performance
Raymond Realty reported a 13% year-on-year growth in real estate revenue and EBITDA in Q4FY25, with revenue at Rs 766 crore and EBITDA at Rs 194 crore. For the full year FY25, revenue grew 45% YoY to Rs 2,313 crore and EBITDA rose 37% YoY to Rs 507 crore. The EBITDA margin for Q4FY25 stood at 25.3%, unchanged YoY, while the FY25 EBITDA margin was 21.9%, down 140 basis points YoY.
Pre-sales for Q4FY25 stood at Rs 636 crore, down 24% YoY due to the absence of new project launches. As of March 2025, the company had a net cash surplus of Rs 395 crore, with closing cash and equivalents at Rs 585 crore and gross debt of Rs 190 crore. The company follows the Percentage Completion Method for revenue recognition.
Looking ahead, RRL's medium-term outlook is focused on developing 60 acres in Thane over 6–8 years and deepening its presence in Mumbai redevelopment through the JDA route. The company's targeted RoCE for projects is 20–22%, and it is confident of surpassing this guidance. Over FY25–28E, RRL expects revenue, EBITDA, and net earnings to grow at a CAGR of 20%, 17%, and 15.9% respectively, reaching Rs 4,065 crore, Rs 813 crore, and Rs 426 crore. EBITDA and net margins are expected to remain steady at 20% and 10.5% respectively. With its asset-light development approach, the company aims to remain net debt free, enabling it to maintain a healthy RoE of 16.2% by FY28.
According to Ventura Securities, the demerger of Raymond Realty provides strategic clarity and unlocks shareholder value by enabling the company to pursue a dedicated and sustainable real estate growth strategy.
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Investors must moderate return expectations, stick to asset allocation: Nilesh Shah
(
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: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)
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