Avenue Supermarts Q3 Results: Key Highlights
Avenue Supermarts, the parent company of DMart, has reported its Q3 results for the financial year ending March 2026. The company has seen a 13.3% growth in revenue, with a net profit of Rs 856 crore compared to Rs 724 crore in the previous year.
The earnings before interest, taxes, depreciation, and amortization (EBITDA) saw a 20.2% uptick at Rs 1,463 crore this quarter compared to Rs 1,217 crore in the previous year. The margins saw an expansion to 8.1% this year from 7.6% last year.
Like-for-Like Sales Growth
The firm’s like-for-like sales growth stood at 5.6% compared to the year-ago period’s 8.3%. This was reported as the slowest in five quarters. The total bill cuts were the highest in five quarters.
The company reported that sales per square feet had improved sequentially. This is a positive sign for the company, indicating that customers are spending more per visit.
Analyst Reactions
Reacting to DMart’s Q3 earnings, CLSA analyst Aditya Soman believes the company’s low-cost operator model remains robust while concerns of competition due to quick commerce are overdone.
Although CLSA has cut the 12-month share price target for Avenue Supermarts Ltd. from Rs 6,300 to Rs 6,105, the new target still implies a 63% upside over Friday’s close of Rs 3,745.10 on the NSE.
The stock has been rated ‘High-Conviction Outperform’ by the analyst. Out of 29 analysts tracking the company, nine maintain a ‘buy’ rating, 12 recommend a ‘hold,’ and eight suggest ‘sell,’ according to Bloomberg data.
What Does This Mean for Investors?
The average 12-month consensus price target of Rs 4,144 implies an upside of 9%. This suggests that analysts are bullish on the company’s prospects, despite the slowest like-for-like sales growth in five quarters.
Investors looking to buy or sell Avenue Supermarts shares should consider the company’s strong track record of growth and its ability to maintain margins. However, they should also be aware of the potential risks, including competition from quick commerce players.
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Key Takeaways
- Avenue Supermarts reports 13.3% growth in revenue
- Net profit stands at Rs 856 crore compared to Rs 724 crore in the previous year
- EBITDA sees a 20.2% uptick at Rs 1,463 crore
- Margins expand to 8.1% from 7.6% last year
- Like-for-like sales growth stands at 5.6%
Overall, Avenue Supermarts’ Q3 results are a mixed bag. While the company has seen growth in revenue and profits, the slowest like-for-like sales growth in five quarters is a concern. Investors should carefully consider the company’s prospects and risks before making any investment decisions.
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