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Avenue Supermarts Ltd (DMart) Q3 FY22 Results

11 January 2022

RK Damani-led Avenue Supermarts Ltd. released their financial result for the September-December quarter of the current financial year. The company reported a 24% year on year (YoY) increase in its PAT at Rs 552.5 crore as against Rs 447 crore in the year-ago period.

The hypermarket chain also reported a 22.2% YoY jump in its revenue from operations to Rs 9,217 crore from Rs 7,542 crore in the corresponding quarter in the last financial year. Although the company’s total income increased from Rs 7,587 crore in Q3 FY21 to Rs 9,243 crore in the current quarter, its income from other sources was reduced by over 40% YoY from Rs 45 crore to Rs 25 crore.

The overall increase in the results is majorly on account of high sales recorded due to the festival season, Diwali buying, and the latest panic-buying among people after the Omicron scare. Avenue Supermarts share closed at Rs 4,731.35 per share on January 7, Friday at 3:30 PM, up by 0.55% during the intraday trading session ahead of its quarterly results(Q3).

Hits

  • 24% YoY jump in consolidated PAT to Rs 552.5 crore from Rs 447 crore
  • QoQ PAT increased from Rs 417 crore to Rs 552.5 crore
  • EBITDA margin stood at 9.4% in Q3 FY22 as compared to 9.1% in Q3 FY21
  • PAT margin stood at 6.0% in Q3 FY22 as compared to 5.9% in Q3 FY21
  •  Basic Earnings per share (EPS) increased to Rs 8.53, against Rs 6.90 in the year-ago period
  • 17 new stores were added in the September-December quarter        

Misses

  • Other income reduced to Rs 25 crore in Q3 FY22 from Rs 45 crore in Q3 FY21
  • Total expenses increased to Rs 8,493 crore in quarterly Q3 FY22 from Rs 6,977 crore in Q3 FY21

What the Management says

Neville Noronha, CEO & Managing Director said, “Revenue in the DMart stores grew by 22.0% in this quarter over the corresponding quarter of last year. Overall gross margins are marginally lower due to mix deterioration. General merchandise and apparel business is consistently seeing relatively lesser sales contribution while essentials and FMCG is doing better. Inflation and lesser opportunities to go out are negatively impacting certain categories more than others. We are seeing higher inflation as an opportunity to make our buying more efficient, our assortment sharper and continue to keep our costs low. Considering the current Covid wave, our sales and footfalls will be dependent on local regulations. We continue to take all precautions to ensure every shopper, employee and partner is operating in a safe environment”.

Other things to know

Avenue Supermarts Ltd runs a chain of hypermarkets and retail stores across India called DMart which offers a range of products following the ‘everyday low cost- everyday low price’ strategy. They procure goods in wholesale quantities at competitive prices, use efficient logistics and operations to sell them to retail customers at a competitive price. DMart currently operates 263 stores across the country.

Avenue Supermarts Ltd has the largest market capitalization among its peers at over Rs 3 lakh crore. The company has the highest P/E ratio at 278 against the industry average of -474.

Disclaimer: The content presented here is only for educational and informational purposes. It is not intended to be advice on what to buy or sell. 

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