DMart Q3 Results Review - Soft Earnings On Weak Discretionary Demand: Motilal Oswal
Lower footfall, weak demand in discretionary non-fmcg segment, with a 20% increase in the store size, affected store productivity,
BQ Prime’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BQ Prime’s subscribers an opportunity to expand their understanding of companies, sectors and the economy.
Motilal Oswal Report
Avenue Supermarts Ltd. posted revenue/profit after tax growth of 25%/7% YoY (6%/18% miss) in Q3 FY23, as weak discretionary demand pulled down same-store sales growth.
While higher size store too increased costs, employee/other expenses per square feet has seen visible cost savings, down down 6%/down 10% versus the pre-Covid level, translating into 5.7% profit after tax margin (closer to pre-Covid levels).
Lower footfall and weak demand in the discretionary non-fmcg segment, along with a 20% increase in the store size, affected store productivity, which may take few quarters to recover.
We estimate an Ebitda/profit after tax compound annual growth rate of 28%/26% over FY23E-25E.
Click on the attachment to read the full report:
This report is authored by an external party. BQ Prime does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of BQ Prime.
Users have no license to copy, modify, or distribute the content without permission of the Original Owner.