InvestorQ : How were the latest results of Avenue Supermarts for the Dec-20 quarter?
ishika Banerjee made post

How were the latest results of Avenue Supermarts for the Dec-20 quarter?

2 years ago

Avenue Supermarts, owner of the D-Mart retail brand, announced solid results for the Dec-20 quarter. Here are the key takeaways.

· Avenue Supermarts reported 16% rise in consolidated net profit at Rs.447 crore in the Dec-20 quarter. The top line also showed impressive growth. Avenue Supermart showed consolidated revenues growing by 11% to Rs.7,542 crore. Even the operating profits for the quarter was sharply up on a YOY basis as well as on a sequential basis.

· For the Dec-20 quarter, Avenue Supermarts reported PAT margins of 5.9 as compared to 5.6% in the corresponding quarter last year. Even the EBITDA margin stood at 9.1% in the third quarter of the fiscal year as compared to 8.8% in the corresponding quarter last year. The company had recently breached the Rs.2 trillion market cap level.

· The Dec-20 quarter showed the first genuine recovery from the impact of COVID-19. The overall sales and sales mix had started trending close to normal pre-COVID levels. However, certain segments like apparel, laundry, footwear were still lagging although the demand had been boosted by food and hygiene products in the quarter.

· What triggered this performance? Good operating expense management was one reason. The festival months of October and November also helped along the way. There continues to be a distinct behaviour of shopping more efficiently by shoppers. The new norm is lesser number of trips and higher basket values and that has helped.

· While it is still largely Mumbai based, they just launched D-Mart Ready in select areas of Ahmadabad, Bengaluru and Hyderabad. It will start via e-Commerce operations in these cities. COVID has given the company the opportunity to fast track the launch of D-Mart Ready in more cities. There is surely something D-Mart appears to have learnt better.