Last updated: 12 Jul, 2021 | 02:50 pm
DMart results review
Outlook going forward
Avenue Supermarts had indicated that it will add 59 stores over FY20-22. It has added 20 stores in FY21. It may look to add 39 stores in FY22, implying 35 store additions over the next nine months, provided there are no further restrictions. However, the target looks steep given the uncertainty around Covid-19 and its variants. There has also been a steep decline in margins, due to limited sale of general merchandise. The margins could remain under pressure over the medium-term, as customers continue to prefer online retailers amid the pandemic. Further, the company faces steep competition from larger peer Reliance Retail. Most brokerages including Jefferies, ICICI Securities and Kotak Institutional Equities have retained a bearish outlook on DMart shares. Jefferies has an ‘underperform’ rating with a target of Rs 2,300 on DMart share price.