DMart Q1 Results: Avenue Supermarts' Net Profit Surges 17% to ₹773 Crore, Revenue Climbs 18% YoY

Avenue Supermarts Ltd., the parent company of DMart, has announced its financial results for the first quarter of the fiscal year 2024-25 (Q1FY25), showcasing a strong performance amid a competitive retail market. The company, backed by ace investor Radhakishan Damani, reported a consolidated net profit of ₹773.8 crore for the April-June quarter, marking a notable increase of 17.5% compared to ₹658.8 crore in the same period last year.

The hypermarket chain operator's revenue from operations also saw a significant rise, climbing 18.6% to ₹14,069 crore from ₹11,865.4 crore in the year-ago period. This impressive growth highlights DMart's effective strategies and robust market presence.

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Financial Performance

At the operating level, Avenue Supermarts' earnings before interest, tax, depreciation, and amortization (EBITDA) increased by 18% to ₹1,221.3 crore, up from ₹1,035.3 crore in the corresponding quarter of the previous fiscal year. The EBITDA margin stood at 8.68%, slightly lower than the 8.73% recorded in the same period last year. This marginal decline in margin indicates increased operating costs due to efforts to improve service levels and build future capabilities.

In its regulatory filing to the stock exchange, DMart reiterated its commitment to the everyday low cost - everyday low price (EDLC-EDLP) strategy. This approach focuses on procuring goods at competitive prices, allowing the company to offer attractive prices to its customers consistently.

Management Insights

Neville Noronha, CEO & Managing Director of Avenue Supermarts Limited, commented on the company's performance: "Our revenue for Q1 FY 2025 grew by 18.4%. Contribution from General Merchandise and Apparel continued to improve during the quarter, and this is reflected in the gross margin uptick (Q1 FY 2025 vs Q1 FY 2024). Operating costs have gone up due to continuing effort on improving service levels and building capability for the future."

Expansion and Market Presence

During the June quarter, Avenue Supermarts expanded its footprint by opening six new stores, bringing the total number of stores to 371. This expansion reflects the company's ongoing commitment to increasing its market reach and enhancing customer convenience.

DMart, promoted by Radhakishan Damani and his family, retails a wide range of basic home and personal products across multiple markets in India. These include Maharashtra, Gujarat, Andhra Pradesh, Madhya Pradesh, Karnataka, Telangana, Chhattisgarh, the National Capital Region (NCR), Tamil Nadu, Punjab, and Rajasthan. The diverse geographical presence helps DMart cater to a broad customer base and leverage regional growth opportunities.

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Strategic Focus and Future Outlook

Avenue Supermarts continues to focus on its core strategy of offering value to customers through competitive pricing and a wide product range. The company's commitment to maintaining low prices while ensuring high service levels has been a key driver of its success. As DMart expands its store network and enhances its operational capabilities, it is well-positioned to capture a larger share of the growing retail market in India.

In conclusion, Avenue Supermarts' robust Q1FY25 performance underscores its strong market position and effective business strategies. The significant increases in net profit and revenue highlight the company's ability to navigate market challenges and capitalize on growth opportunities. As DMart continues to expand and innovate, it is poised to maintain its trajectory of success and deliver value to its stakeholders.

With a keen focus on cost efficiency, customer satisfaction, and strategic expansion, DMart remains a formidable player in the Indian retail sector. The company's impressive Q1 results set a positive tone for the remainder of the fiscal year, promising continued growth and resilience in an evolving market landscape

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