Avenue Supermarts, which operates retail chain DMart, reported a standalone net profit of Rs 830 crore in the first quarter of FY26. This was up just 2% from Rs 812 crore posted in the previous year quarter.
Revenue from operations in the same period increased 16% year-on-year (YoY) to Rs 15,932 crore.
During the quarter, the company opened nine new stores, bringing the total store count to 424 as of the end of June.
The company said that while overall growth in revenue was strong, there were certain pressures that affected margins and costs.
One of the key factors was high deflation in the prices of several staple food items and non-food products. This price decline impacted sales growth by about 100 to 150 basis points. Additionally, the FMCG market remained highly competitive, which also put pressure on margins.
For the quarter, it reported a standalone EBITDA of Rs 1,313 crore, compared to Rs 1,221 crore in the same quarter last year. The EBITDA margin stood at 8.2%, down from 8.9% in the year-ago period.
On a consolidated basis, the EBITDA stood at Rs 1,299 crore, with an EBITDA margin of 7.9%, also lower than the 8.7% posted in Q1FY25.
The company's CEO and MD Neville Noronha said that older stores (two years and above) recorded a 7.1% growth in the quarter.
The company also noted an increase in operating costs, attributed to improved service levels, capacity building, and inflation in entry-level wages. The gross margin was lower compared to the previous year due to continued competitive pressure in the FMCG segment.
On Friday, DMart stock closed 2% lower at Rs 4,069 on NSE.
Revenue from operations in the same period increased 16% year-on-year (YoY) to Rs 15,932 crore.
During the quarter, the company opened nine new stores, bringing the total store count to 424 as of the end of June.
The company said that while overall growth in revenue was strong, there were certain pressures that affected margins and costs.
One of the key factors was high deflation in the prices of several staple food items and non-food products. This price decline impacted sales growth by about 100 to 150 basis points. Additionally, the FMCG market remained highly competitive, which also put pressure on margins.
For the quarter, it reported a standalone EBITDA of Rs 1,313 crore, compared to Rs 1,221 crore in the same quarter last year. The EBITDA margin stood at 8.2%, down from 8.9% in the year-ago period.
On a consolidated basis, the EBITDA stood at Rs 1,299 crore, with an EBITDA margin of 7.9%, also lower than the 8.7% posted in Q1FY25.
The company's CEO and MD Neville Noronha said that older stores (two years and above) recorded a 7.1% growth in the quarter.
The company also noted an increase in operating costs, attributed to improved service levels, capacity building, and inflation in entry-level wages. The gross margin was lower compared to the previous year due to continued competitive pressure in the FMCG segment.
On Friday, DMart stock closed 2% lower at Rs 4,069 on NSE.
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