Avenue Supermarts Ltd, the operator of the popular DMart retail chain, has delivered a robust financial performance for the third quarter of the fiscal year 2023-24. The company announced a significant 17.6% year-on-year increase in consolidated net profit, which reached Rs 923 crore for the quarter ended December 31, 2023.
Detailed Financial Performance
The company's revenue from operations also saw healthy growth, climbing 17.3% to Rs 13,572 crore compared to Rs 11,569 crore in the same period last year. This indicates sustained consumer demand across DMart's extensive network of stores. On a sequential basis, the profit showed an impressive jump from the Rs 623 crore reported in the September quarter.
Earnings before interest, tax, depreciation, and amortization (EBITDA) for the quarter stood at Rs 1,119 crore, marking a 16.6% increase from the Rs 960 crore recorded in the corresponding quarter of the previous fiscal year. However, the EBITDA margin saw a slight contraction, coming in at 8.2% compared to 8.3% in the year-ago period.
Operational Metrics and Store Expansion
A key highlight of the quarter was the company's continued expansion. Avenue Supermarts added 6 new DMart stores, bringing its total store count to 351 as of December 31, 2023. This steady expansion is a core part of the company's strategy to deepen its penetration in existing markets and enter new regions.
The company's stock market performance reflected investor confidence following the results. On the day of the announcement, shares of Avenue Supermarts closed 1.75% higher at Rs 4,190.05 on the Bombay Stock Exchange (BSE). The financial results were approved by the company's board of directors in a meeting held on Saturday, January 13, 2024.
Market Context and Future Outlook
The strong results from DMart come at a time when the Indian retail sector is witnessing intense competition and evolving consumer patterns. The company, founded by renowned investor Radhakishan Damani, has maintained its focus on a low-cost, high-volume business model, which continues to resonate with value-conscious Indian shoppers.
Analysts will be closely watching the company's ability to maintain its margin profile amid potential cost pressures and its strategy for growth in a competitive landscape that includes both traditional rivals and emerging online grocery platforms. The consistent store addition and solid revenue growth suggest the company is on a firm growth trajectory, leveraging its strong supply chain and customer loyalty.
The Q3 results reinforce DMart's position as a dominant player in India's organized retail space. The focus now shifts to its execution in the final quarter of the fiscal year and its plans for the upcoming year, where balancing growth with profitability will be key.
