Raymond witnesses 104% revenue increase in Q1FY23, highest in 10 years

Raymond Ltd., on Friday, announced that it has achieved another strong quarter with the highest quarterly revenue and profitability in the last 10 years in its consolidated financial results for the quarter ended June 2022. The homegrown textile major reported that its revenue was at Rs 1,754 crore, up 104 per cent from last year. The company also saw the highest Q1 earnings before interest, taxes, depreciation, and amortization (EBITDA) of Rs 235 crore with a margin of 13.4 per cent in the last 10 years.

Gautam Hari Singhania, Chairman and MD, Raymond, in a statement, said, “The growing demand in both - domestic and international markets along with new customer acquisitions in international markets has been rewarding for the quarter. Furthermore, our real estate project is progressing well with sales velocity and construction pace of both the projects at Thane. This helps us to deliver strong performance for our real estate business.”

The company, on account of higher production to address the upcoming festival and wedding season sales, witnessed temporarily high inventory and saw an increase in its working capital. This further resulted in an increase in net debt by Rs 222 crore to Rs 1,310 crore. “We will continue our debt reduction plans and the current net debt will be further reduced in the current financial year,” it added.

“Capitalising on market buoyancy and strong wedding demand, ably supported by expansive distribution helped propel sales. B2C businesses continue to grow with sustained sentiments and strong consumption across markets. Garmenting business demonstrated resilience with a strong order book. The sustained demand from home buyers contributed to our real estate business with diverse product offerings,” the company stated.
 
Raymond’s branded textile segment sales saw a growth of 129 per cent at Rs 648 crore against Rs 283 crore in Q1FY22, driven by a busy summer wedding season with high demand being witnessed across primary channels and strong momentum in secondary sales. The segment also reported an EBITDA margin of 17.6 per cent driven mainly due to enhanced operational efficiencies.

Moreover, Raymond’s branded apparel segment due to the surging consumer demand for the company’s brands, integral to wedding season-related purchases, propelled sales to Rs 262 crore in Q1FY23. The segment’s EBITDA margin stood at 5.6 per cent as compared to a loss in the previous year.

The textile manufacturer’s The Raymond Shop (TRS) network, witnessed 31 per cent growth during Q1FY23 in average transaction value (ATV) as compared to the same period (pre-covid). As of June 30, 2022, the company also witnessed high consumer footfalls across 1,372 store network of TRS and EBOs.

Raymond’s garments segment reported sales at Rs 247 crore in Q1FY23, up 153 per cent compared to Rs 98 crore in Q1FY22, mainly due to high demand from existing customers in US & Europe markets and new customer acquisitions. EBITDA margin for the quarter stood at 6.1 per cent.

The company’s high-value cotton shirting segment reported a 68 per cent increase in sales to Rs 170 crore, led by higher demand for cotton fabric by B2B customers in the Indian market. The segment’s EBITDA margin stood at 9.7 per cent for Q1FY23.

In terms of engineering business, sales grew 17 per cent to Rs 209 crore, driven by growth in domestic markets across categories and exports markets of US, Europe & Asia with growth in ring gears, drills and bearing categories. The business saw an EBITDA of Rs 27 crore in the quarter.

The company’s real estate business recorded sales growth of 120 per cent to Rs 286 crore in Q1FY23 from Rs 130 crore in Q1FY22, owing to the strong growth in bookings due to improved demand, overall liquidity in the market and fast pace construction momentum in projects.