DMart (Avenue Supermarts) shares fall 5% after Q3 results miss estimates

Shares of Avenue Supermarts, the operator of retail chain DMart, plunged over 5% today following the release of its Q3 FY25 results, which fell short of market expectations.

Key Financial Highlights:

• Net Profit: ₹723.54 crore, up 4.9% YoY (₹690 crore in Q3 FY24).
• Revenue: ₹15,973 crore, up 17.6% YoY (₹13,572 crore in Q3 FY24).
• EBITDA Margin: 7.6% in Q3 FY25 vs. 8.3% in Q3 FY24.
• PAT Margin: Declined to 5% from 5.5% YoY.
• Expenses: Total expenses rose to ₹15,001.64 crore from ₹12,656.46 crore YoY.

Brokerage Reaction:

ICICI Securities maintained a ‘reduce’ rating on Avenue Supermarts with a target price of ₹3,300, implying a downside from the current market price of ₹3,702.35.

Key Insights from ICICI Securities:

• Medium-Term Growth Concerns: Uncertainty over the company’s medium-term growth trajectory remains a critical issue.
• Operational Recovery: Like-for-like growth showed improvement, signaling some operational positives.
• Revised Estimates: Earnings estimates were reduced by 1% for FY25 and 3% for FY26, driven by lower margin assumptions.

As of 9:15 am the shares were trading 5.03% lower at ₹3,501.00 on NSE.