Avenue Supermart | Business Upturn

Avenue Supermarts (DMart) loses ₹23,128 crore in market cap after an 8.39% decline in stock price

Aditya Bhagchandani — Mon, 14 Oct 2024 06:24:28 +0000

Avenue Supermart Ltd. (D-Mart) shares saw a sharp decline of over 8% after the company posted weaker-than-expected results for the second quarter of this financial year. The company reported a 5.8% year-on-year increase in net profit to Rs 659.44 crore, missing analysts’ estimates of Rs 812 crore. This marked a significant shortfall for the parent company of D-Mart.

Revenue for the quarter rose by 14.4% year-on-year to Rs 14,444.50 crore, but again fell short of analysts’ projections of Rs 14,597 crore. The company’s earnings before interest, taxes, depreciation, and amortisation (EBITDA) increased 8.8% year-on-year to Rs 1,093.77 crore, with an EBITDA margin contraction to 7.6% from 8% a year earlier. Analysts had expected an EBITDA of Rs 1,210 crore and a margin of 8.30%.

Following the results, Avenue Supermart’s stock price dropped by 8.06%, trading at ₹4,204.00 on the NSE as of 9:15 am. The company’s total market capitalisation dropped significantly, falling from ₹4,57,270 crore to ₹2,72,390.35 crore, marking a market cap loss of ₹1,84,879.65 crore.

Brokerage Reactions and Downgrades

The weaker Q2 results led to several downgrades from brokerages:

Morgan Stanley downgraded Avenue Supermart to ‘Underweight’ and reduced the target price to Rs 3,702. The brokerage expressed concerns over the company’s ability to maintain a 20% top-line growth trajectory, suggesting that further de-rating of the stock is possible.
JPMorgan downgraded the stock to ‘Neutral’ and revised the target price down from Rs 5,400 to Rs 4,700. JPMorgan also lowered its revenue and same-store sales growth (SSSG) forecasts by 4-6% for FY25-26E, and reduced its EBITDA estimates by 8% and 10% for FY25 and FY26, respectively.

The downgrades reflect the growing concerns about D-Mart’s future growth potential, adding pressure to the stock’s performance in the near future.

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D-Mart shares decline over 8% following weak Q2 results and downgraded brokerage ratings

Aditya Bhagchandani — Mon, 14 Oct 2024 03:46:17 +0000

Avenue Supermart Ltd. (D-Mart) shares declined over 8% after the company posted weaker-than-expected results for the second quarter of this financial year. The company reported a 5.8% year-on-year increase in net profit to Rs 659.44 crore, missing analysts’ estimates of Rs 812 crore. This marked a significant shortfall for the parent company of D-Mart.

Revenue for the quarter rose by 14.4% year-on-year to Rs 14,444.50 crore, again falling short of analysts’ projections of Rs 14,597 crore. The company’s earnings before interest, taxes, depreciation, and amortisation (EBITDA) increased 8.8% year-on-year to Rs 1,093.77 crore, with an EBITDA margin contraction to 7.6% from 8% a year earlier. Analysts had expected an EBITDA of Rs 1,210 crore and a margin of 8.30%.

As of 9:15 am the shares were trading 8.06% lower at ₹4,204.00 on NSE

Brokerage Reactions and Downgrades

Following the release of the weaker Q2 results, several brokerages downgraded their outlook on Avenue Supermart:

Morgan Stanley downgraded Avenue Supermart to ‘Underweight’ and cut the target price to Rs 3,702. The brokerage expressed concerns over management commentary, raising doubts about the company’s ability to maintain a 20% top-line growth trajectory, which could result in further de-rating of the stock.
JPMorgan also downgraded the stock to ‘Neutral’ and revised the target price from Rs 5,400 to Rs 4,700. The brokerage lowered its revenue and same-store sales growth (SSSG) forecasts by 4-6% for FY25-26E, while cutting its EBITDA estimates by 8% and 10% for FY25 and FY26, respectively.

The downgrades by major brokerages highlight concerns about D-Mart’s future growth prospects, adding pressure to the company’s stock performance in the coming days.

Stocks to watch: Avenue Supermarts, HDFC, Vedanta, South Indian Bank, and others

Aryan Jakhar — Tue, 04 Oct 2022 03:25:46 +0000

The market began the week on a downbeat tone with the major indices falling more than 1% on October 3, with the exception of pharmaceuticals, where selling pressure was felt across all sectors. The Nifty50 plummeted 207 points to 16,887, while the BSE Sensex fell 638 points to 56,789

Stocks to watch:

South Indian Bank:

The bank released preliminary data for the September FY23 quarter, noting that gross advances increased 17% YoY to Rs 67,981 crore while deposits increased 2% YoY to Rs 88,503 crore.

Housing Development Finance Corporation

In Q2FY23, loans assigned totaled Rs 9,145 crore, up from Rs 7,132 crore during the same period previous year, according to HDFC. The HDFC Bank received every loan that was assigned throughout the quarter. The total amount of gross dividend income for the second quarter was Rs 1,360 crore, while the profit from selling investments was zero.

KEC International

The infrastructure EPC firm has received fresh orders totaling Rs. 1,407 crore from various markets. The Middle East placed orders with the transmission and distribution section, and the railways business obtained a contract for signalling and telecommunications work. Its total order intake for the year is currently at Rs 8,400 crore.

Dilip Buildcon

The Surat Metro Rail Project in Gujarat has got a letter of acceptance (LOA) from the road construction company through its joint venture RBL-DBL. The order in question is for Rs 1,061 crore.

Vedanta

In addition, Zinc India reported its highest-ever second quarter mined metal production at 2.55 lakh tonnes, up 3 percent YoY, driven by better grades and improved mill recoveries. The company said its alumina production at Lanjigarh refinery decreased by 11% YoY to 4.54 lakh tonnes due to scheduled maintenance. Due to the conclusion of debottlenecking operations in Q1FY23, the steel segment’s total saleable production grew by 11% YoY to 3.25 lakh tonnes.

Avenue Supermarts

The D-Mart operator reported standalone revenue for the three months ending in September 2022 at Rs. 10,384.66 crore, up 36% from Rs. 7,649.64 crore during the same period in the previous year. There were 302 stores overall as of September 2022.

Mahindra & Mahindra Financial Services

According to the corporation, the business kept growing with the payment of over Rs 4,080 crore, resulting in an increase of 11% YoY in September 2022, helped by macro tailwinds. A disbursement of roughly Rs 21,300 crore is anticipated for the first half, which resulted in a robust gross asset book of approximately Rs 73,900 crore, up 3% month over month. In comparison to August 2022, when the collection efficiency was 96%, September 2022 had a 98 percent increase in collection efficiency.

Marico

With a three-year CAGR in the high single digits, its India division saw low single-digit volume growth, and its overseas business continued its great performance with double-digit constant currency growth. As a result, its consolidated revenue for the September FY23 quarter increased year over year in the low single digits. A higher effective tax rate will have an even greater influence on net earnings.

DMart market capitalization hits 2.5 lakh crore mark for first time ever

Vandana Nampoothiri — Fri, 27 Aug 2021 09:26:24 +0000

Retail company DMart’s prices surged 1.6% to reach an all-time high of Rs. 3,909.50 on BSE on Friday. The price hike comes a day after the company’s market capitalization reached Rs. 2.5 lakh crore mark.

Dmart, also known as Avenue Supermarts became the 17th largest company in the Indian market. It is now ahead of Axis Bank, L&T, UltraTech, Maruti Suzuki, and Nestle.

Varun Singh, FMCG, and Retail Analyst at Mumbai-based brokerage IDBI Capital Markets & Securities told CNBC, “During periods of high inflation, DMart is likely to gain more share from both general trade and online players due to significant price advantage.” He also said that he expects DMart to become a 100 bagger stock in the next 25 years.

The company earned a net profit of Rs. 115 crore for Q1 FY22, as compared to Rs. 50 crore in the corresponding quarter of last year.

Speaking about the results, Neville Noronha, CEO & Managing Director, Avenue Supermarts said, “Q1 FY 2021-22 saw a much stronger second wave of Covid-19 restrictions. We lost significantly more days or had a higher restriction on a number of hours of store operations compared to the same period last year.”

According to CNBC, DMart shares have risen 39 per cent so far this year, easily beating the 17 per cent return of the headline Sensex index.

DMart secures gains of over 20% in last six sessions

Shalmali Bhagwat — Wed, 09 Dec 2020 07:27:33 +0000

According to Mint, shares of Avenue Supermart Ltd, which controls the popular hypermarket chain DMart, have soared by nearly 20% in the last six sessions, breaking a record in the background of higher volumes.

The stock hit an all-time high of ₹2,752 on the BSE. At 10.21 am, the scrip was at ₹2,696, up 1.5% from its previous close. Since 27 Nov till date, the scrip has risen 20.16%. So far this year it has advanced 47%. As of 12:18 am Avenue Supermarts was trading at Rs 2,685.

Avenue Supermarts, focussed on value retailing, offers a wide range of fast-moving consumer (food and non-food) products, general merchandise, and apparel. While announcing the September quarter (Q2FY21) results on October 17, the company’s management said that month-on-month sales have are looking positive during this quarter – August was better than July and September was better than August. The management said that the progress of the COVID-19 pandemic and its impact on consumer spending during the festival period will determine the company’s financial performance for the next quarter.

According to Mint, Analysts said this gain was hitched to the expected hike in footfall after at least three vaccine makers had applied for an emergency approval from Indian drug regulator. Recently, pharma majors Pfizer and Serum Institute of India (SII), Hyderabad-based Bharat Biotech International Ltd have sought emergency use authorization from the Drugs Controller General of India (DCGI) for its COVID-19 vaccine.

With this, analysts hope that early vaccines may soon return economic life back to normal all over the world.