Mutual Funds Commodities Research Tax Planning IPO Our Team Contact Us  

| More

Avenue Supermarts - Q2FY22 Result Update - YES Securities

Posted On: 2021-10-18 12:15:15 (Time Zone: IST)

Strong revival and higher long-term growth assumptions to help support valuations, Maintain ADD

Our view

The recovery momentum witnessed towards the end of Q1 has picked up further pace displaying the resilience of the company's value retailing business model and its ability to compete with online retailers. While valuations have become more expensive post recent run-up and can be a near-term risk in case of a market correction, we continue to believe that DMART is well-placed to capture long-term growth opportunity for grocery retail given its scalable model and low-cost structure which should enable a growth rate of 25% plus for the next decade. Its strong balance sheet, aggressive store expansion, cash generation and solid SSGs boosted by DMart Ready should be key growth enablers.

Result Highlights

  • Result summary - Strong performance on both revenue and margins front led by strong momentum in footfalls and higher discretionary sales. Revenue grew ~47% yoy (29% above 2QFY20) helped by 8 new store openings in 2Q. DMart registered 23.7% SSSG in Sep 2022 vs Sep 2021.
  • Margins - Gross margin improved 30bps/190bps YoY/QoQ aided by recovery in higher margin general merchandise sales which resulted in EBITDA margin improvement of 260bps/440bps YoY/QoQ helped further by continuation of strong cost controls.
  • Our calculated revenue/sqft and EBITDA/sqft was up by 24%/75% YoY. Positive margin surprise led to strong earnings performance with robust 113% PAT growth.
  • E-commerce business saw revenue growth of 58.6% YoY to Rs 1.4bn with EBITDA loss of Rs15.6mn vs profit of Rs51.1mn YoY. DMart Ready was launched in Surat and Vadodara during the quarter.


We believe the company should register positive SSSG in Q3FY22 led by robust demand in the ongoing festive season. We model in revenue/PAT CAGR of 37%/48% over FY21-24E, the highest growth in the large cap consumption space and maintain an ADD rating with a PT of Rs 5,530 based on 65x FY24E EV/EBITDA, implying 100x FY24 P/E. Key risk would be any disruption due to third wave of Covid-19 pandemic.

Shares of Avenue Supermarts Limited was last trading in BSE at Rs. 5329.65 as compared to the previous close of Rs. 5122.55. The total number of shares traded during the day was 110885 in over 22954 trades.

The stock hit an intraday high of Rs. 5420.00 and intraday low of 5179.90. The net turnover during the day was Rs. 591262079.00.

Click here to send ur comments or to

Disclaimer:The article above is a gist / extract of the original report prepared by the research firm / brokerage firm. This article is not to be considered as an offer to sell or a solicitation to buy any securities. This article is meant for general information only., its employees or owners or the research firms, its employees or owners won't be responsible for any liability that may arise from information, errors or omissions in these articles. or its employees or owners / the research firms or its employees or clients or owners may from time to time hold positions in securities referred in this article. For detailed research reports, please contact the concerned research firm directly.

Other Headlines:

RateGain Travel Technologies - IPO - Riding the Technology and Travel Wave, Valuations at Discount

BOB Caps initiates coverage on Blue Star Limited

Economy: Weaker exports widen trade deficit - Kotak

Slowdown continues in the auto lane - Acuite Insights

Anand Rathi Wealth Ltd - IPO - Healthy Prospects; Valuations Look Pricey - Reliance Securities

IPO Review - Anand Rathi Wealth Management: A play on structural wealth management business - ICICI Direct

India's GDP back to its pre-Covid levels - Acuite Ratings & Research

Expect to see the industrial sector firing on all cylinders in H2FY22 - Acuite Ratings

Q2FY22 GDP Numbers - Suvodeep Rakshit - Kotak Institutional Equities

India Q2FY22 GDP data - JLL

The absolute real GDP value has exceeded the pre-pandemic levels of Q2FY20 by 0.33% - Acuite Ratings & Research

Post Listing view on Go Fashion by Mr. Santosh Meena, Head of Research, Swastika Investmart Ltd

Mutual Fund Review - November, 2021 - ICICI Direct

Maintain SELL on Asian Paints - Demand rebound strong; profitability cut steeper - HDFC Securities

Mphasis - 2QFY22 Result Update - Growth Resiliency Continues; Raise Target Price - Reliance Research

Gateway Distriparks - Rail continues to drive earnings - ICICI Securities

JSW Steel - Start of EBITDA contraction cycle - ICICI Securities

Shoppers Stop - Beneficiary of faster than expected recovery - ICICI Securities

Asian Paints - Q2FY22 Result Update - ICICI Securities

TVS Motor Company - EVs now at the center of its global ambitions - ICICI Securities

Havells India - Strong demand across regions; profitability likely to be muted in H2FY22 - ICICI Securities

Tata Communications - Rising visibility on revenue growth - ICICI Securities

Angel Broking - Business momentum intact for strong earnings growth - ICICI Securities

Q2FY22 Result Update - Rallis India - ICICI Direct

Q2FY22 Result Update - Navin Fluorine - ICICI Direct

Q2FY22 Result Update - Shoppers Stop - ICICI Direct

Company Update - Mastek Ltd - ICICI Direct

Q2FY22 Result Update - JSW Steel - ICICI Direct

Q2FY22 Result Update - VST Industries - ICICI Direct

HDFC Life Insurance - Q2FY22 First Cut - ICICI Direct

Federal Bank - Q2FY22 First Cut - ICICI Direct

Company Update - Taj GVK Hotels - ICICI Direct

Q2FY22 Result Update - Indian Hotels - ICICI Direct

Inox Leisure - Q2FY22 First Cut - ICICI Direct

Supreme Industries - Q2FY22 First Cut - ICICI Direct

Q2FY22 Result Update - Biocon Ltd - ICICI Direct

PVR Ltd - Q2FY22 First Cut - ICICI Direct

Q2FY22 Result Update - Asian Paints - ICICI Direct

Quant Pick - RBL Bank - ICICI Direct

Q2FY22 Result Update - IIFL Securities - ICICI Direct

Q2FY22 Company Update - Bank of Baroda - ICICI Direct

Q2FY22 Result Update - Syngene International - ICICI Direct

Company Update - Sonata Software - ICICI Direct

Q2FY22 Result Update - Gateway Distriparks - ICICI Direct

Q2FY22 Result Update - Tata Communications - ICICI Direct

Q2FY22 Result Update - Havells India - ICICI Direct

Mphasis - 2QFY22 Result Update - Growth Resiliency Continues; Raise Target Price - Reliance Research

Maintain ADD on Havells India - Outperformance continues; miss on margin - HDFC Securities

Indraprastha Gas - Company Update - EV vs CNG; TCO Economics Favour CNG - Reliance Research

FinTech Playbook - Discount Brokers - 'Nudging' the long tail of standalone brokers - HDFC Securities

Website Created & Maintained by : Chennai Scripts
West Mambalam, Chennai - 600 033,
Tamil Nadu, India

disclaimer copyright © 2005 - 2020