In a surprising turn of events, Raymond Ltd. experienced a dramatic decline in its stock price, plummeting over 64% during early trading on Wednesday. The shares, which once soared to a 52-week high of Rs 2,380, fell to a staggering low of Rs 523.10. This drop has left many investors scratching their heads, but the reasons behind this fluctuation are not rooted in negative news or market panic. Instead, it stems from a technical adjustment related to the company’s recent demerger.

Understanding the Share Price Decline

Raymond’s stock price adjustment is directly tied to the recent separation of its real estate division, Raymond Realty. This significant corporate restructuring became official on May 1, when the National Company Law Tribunal approved the demerger plan.

What Triggered the Price Drop?

• The ex-date for the demerger was set for May 14. This is a crucial date when the market no longer accounts for the value of the real estate arm in the stock price.
• Following this date, the market recalibrated the share price to reflect the absence of Raymond Realty’s value, resulting in the sharp decline.

This type of adjustment is a common practice in the stock market whenever a company spins off a segment of its business.

Key Details About the Demerger

Raymond announced its intention to split its real estate segment into a standalone entity, Raymond Realty, back in July 2024. The plan received approval from the National Company Law Tribunal earlier this year, leading to its official implementation on May 1.

• Shareholders are entitled to 1 share of Raymond Realty for every share of Raymond they own.
• The record date, which determines shareholder eligibility for the new shares, was also May 14.

What This Means for Investors

Despite the apparent drop in share price, investors should not be alarmed. The value is not lost; it has merely transitioned to a different asset.

If you owned shares of Raymond before the record date, you can expect to receive shares of Raymond Realty once it debuts on the stock market, projected to take place in the September 2025 quarter.

Raymond’s Stock Performance

The aftermath of this demerger resulted in Raymond’s stock touching a new 52-week low of Rs 523.10. While this may appear concerning at first glance, the broader implications for shareholders are more nuanced.

Investors are encouraged to stay informed and consider the potential of Raymond Realty as it prepares for its upcoming launch.

For more insights on market trends and corporate strategies, check out our related articles on Tata Motors’ latest financial performance and other significant developments in the stock market.