Mumbai, July 4 : Textiles and apparel major Raymond Ltd announced on Thursday that its board has approved the demerger of its real estate business, Raymond Realty Ltd.

The demerger plan aims to "exploit the growth potential of the real estate business and attract a fresh set of investors / strategic partners to participate in the real estate business, it is proposed to consolidate the entire real estate business of the Group under one single entity", the company said in a filing with the stock exchanges.

As per the demerger terms, shareholders of Raymond Ltd will receive one equity share of Raymond Realty for every share of Raymond. The demerged entity will be listed on the Bombay Stock Exchange and National Stock Exchange.

"This strategic move comes as Raymond's real estate business has achieved scale, reporting revenue of Rs 1,593 crore (43 per cent YoY growth). Raymond Realty has 100 acres of land in Thane, of which about 40 acres is currently under development. There are five ongoing projects worth Rs 9,000 crore on its Thane land, with an additional potential to generate more than Rs 16,000 crore, making a total potential revenue of over Rs 25,000 crore from this land bank," Raymond said in a press statement.

Recently, Raymond Realty launched its first joint development agreement project (JDA) at Bandra in Mumbai.

Additionally, Raymond has signed three new agreements in Mahim, Sion, and one more in Bandra East, Mumbai, taking the combined revenue potential from four JDA projects in the Mumbai Metropolitan Region to over Rs 7,000 crore, the statement added.

Gautam Hari Singhania, Chairman-cum-Managing Director, Raymond Limited, said: "Now we have clear three vectors of growth at Raymond group i.e. Lifestyle, Real Estate and Engineering, this corporate action is in line with creating shareholder value."

/IANS