Avenue Supermarts, the parent firm of the popular retail chain DMart, saw its shares experience selling pressure during Monday’s trading session. This market movement followed the company’s latest financial results for the first quarter of FY27, which highlighted a deceleration in sales growth despite an overall increase in net profit.
Stock Market Performance
Shares of Avenue Supermarts opened at Rs 3950 on the NSE, marking a decline of 69 points from the previous close. While the stock managed a slight recovery as the session progressed, it was trading at approximately Rs 4000 at the time of writing, representing a dip of 1.99%.
Quarterly Earnings Breakdown
DMart reported an 11.3% increase in net profit for Q1FY27, with figures rising to Rs 860 crore compared to Rs 772.9 crore in the same period last year. The consolidated revenue of the company climbed by 14.8% to reach Rs 18,794.5 crore, up from Rs 16,359.70 crore recorded in the corresponding quarter of the previous fiscal year.
Operational Costs and Margins
Total expenditure for the company rose significantly to Rs 17,637.2 crore, up from Rs 15,321.7 crore a year earlier. Meanwhile, profit before tax saw a year-on-year growth of 11.88%, totaling Rs 1,183.14 crore. Consolidated EBITDA also recorded a strong performance, growing by 15.39% year-on-year to reach Rs 1,499 crore, compared to Rs 1,299 crore previously. The EBITDA margin showed a marginal improvement, shifting from 7.9% to 8.0%.
Brokerage Perspective
HDFC Securities has maintained an 'Add' rating on Avenue Supermarts, setting a target price of Rs 4,150. However, the brokerage firm has trimmed its earnings estimates for FY27 and FY28 by approximately 3% and 2%, respectively. Analysts noted that while standalone revenue grew by 15.1% year-on-year, the same-store sales growth moderated to 5.5% from 7.1% a year ago. Growth in metro stores remained largely stagnant, whereas non-metro markets demonstrated resilience with a 14-15% like-for-like growth.
Corporate Overview
Headquartered in Mumbai, Avenue Supermarts Limited operates a large-scale hypermarket chain focused on providing groceries and household essentials at highly competitive prices. Founded by Radhakishan Damani, the organization has built a strong business model centered on value-driven retailing under the DMart brand.
