DMart Share Price nse Today: Market Insights and Latest Trends (October 14, 2024)
Today, October 14, 2024, shares of Avenue Supermarts Ltd. (DMart) have experienced a significant decline, plunging by 9.37% to hit an intraday low of ₹4,143.60. This drop follows the release of the company’s Q2 results, which fell short of market expectations, leading to a wave of concern among investors.
Key Financial Highlights
In the September quarter (Q2FY25), DMart reported a 5.8% year-on-year increase in net profit, amounting to ₹659.6 crore, compared to ₹623.6 crore in the same quarter last year. Revenue also rose by 14.4%, reaching ₹14,444.5 crore, up from ₹12,624.37 crore in Q2FY24. However, these figures were not enough to satisfy market analysts, as the revenue growth was the lowest recorded for DMart in any quarter.
- Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) surged by 29.3% to ₹1,093.8 crore, with an EBITDA margin improvement to 7.6% from 6.7% year-on-year.
- Despite these positive indicators, the like-for-like (LFL) growth fell sharply to 5.5%, down from 9.1% in Q1FY25.
Market Reactions
The disappointing results prompted several brokerages to revise their ratings on DMart’s stock:
- ICICI Securities downgraded their rating from “Add” to “Reduce,” setting a revised target price of ₹4,100 due to increased competition from online grocery formats and declining footfalls.
- Analysts at Nuvama also expressed concerns about lower store productivity and cut their FY25 estimates for revenue and EBITDA by 3% and 4%, respectively.
- In contrast, some brokerages like Motilal Oswal Financial Services Ltd. (MOFSL) maintained a “Buy” rating but adjusted their target price to ₹5,655, citing potential for recovery as store additions ramp up.
Broader Implications
The decline in DMart’s share price reflects broader challenges facing traditional retail amid rising competition from quick commerce and online grocery services. The rapid growth of these alternatives has begun to overlap with DMart’s customer base, impacting its sales and foot traffic.As consumers increasingly seek convenience through online shopping options, DMart faces the challenge of adapting its business model while continuing its expansion strategy. The company plans to add approximately 40 stores in FY25, which could help mitigate some of the pressures it currently faces.
Conclusion
The current state of DMart’s share price serves as a critical indicator of both the company’s performance and the evolving landscape of retail in India. As investors digest today’s news and analysts adjust their projections, all eyes will be on how DMart navigates these challenges in the coming quarters. The focus will also be on consumer behavior during the festive season and how it impacts sales trends for the retailer.For those considering investment in DMart or monitoring its performance closely, today’s developments underscore the importance of staying informed about market trends and company strategies amidst a rapidly changing retail environment.