The Company has informed incorporating a new 100% step subsidiary, Ten X Realty Ltd (TXRL) to undertake the real estate business.
Key points to note –
- What is step subsidiary – subsidiary of a wholly owned subsidiary.
- What would the step subsidiary do – business of development / joint development of land and properties other than Raymond’s existing properties situated at Thane, Maharashtra.
- What is Raymond’s capital commitment to this Company – Rs 150 crore in tranches over a period of time. Out of that, Rs 75 crore would be in the form of Redeemable Preference Shares and balance can be equity and/or debt as deem fit.
Raymond recently had announced intent to reorganise it’s varied businesses. Formation of TXRL is surely an extension of the same.
However, what is different is – instead of only focusing on it’s existing properties at Thane, the new Company will look for other real estate opportunities. This clearly conveys Raymond’s ambitions in the real estate sector with it’s related implications.
Investment commitment may seem small for now. However, they can build up very quickly in this sector.
Though I am bullish on real estate sector in general – whether I would want to play that through Raymond….. I doubt !