Brokerages offered mixed views on Avenue Supermarts (DMart) following its Q1FY26 results, as sales growth moderated slightly despite steady store expansions.
Macquarie maintained its underperform rating with a target price of ₹3,000, noting a marginal miss in sales growth and healthy store additions. The brokerage expects a sequential uptick in gross and EBITDA margins in Q1 thanks to the product mix but sees limited upside at current valuations.
Morgan Stanley retained its underweight stance with a target of ₹3,260, estimating that EBITDA margins for Q1FY26 would decline to 7.8% from 8.7% in the year-ago quarter. It highlighted that same-store sales growth (SSSG) was about 3–4% during the quarter, reflecting a slowdown from previous quarters.
In contrast, CLSA struck a more positive tone, maintaining an outperform rating with a higher target price of ₹5,549. The brokerage noted that Avenue Supermarts reported standalone revenue of ₹159,321 million for Q1FY26, about 2% below estimates but still delivering a 16.2% year-on-year sales growth. CLSA also highlighted the addition of nine new stores during the quarter, taking the total to 424, up from six store additions in Q1FY25.
Meanwhile, the shares of Avenue Supermarts are trading around ₹4,391.90 as of today, reflecting a cautious outlook from some brokerages despite operational resilience and continued expansion.
