D-Mart Q3FY22 results a mixed bagDMART - 3574 Change: -56.30 (-1.55 %)
News: As guided by the management in its pre-quarterly update, Avenue Supermarts reported revenue growth of 22% YoY to Rs.9217.8 crore (two-year CAGR: 16%). Owing to positive operating leverage, EBITDA margins improved marginally by 30 bps YoY to 9.4% (I-direct estimate: 9.9%). Absolute EBITDA grew by 26% YoY to Rs.866.5 crore (I-direct estimate: Rs.914.8 crore). Lower other income (down 43% YoY) and higher finance cost (up 23% YoY), resulted in company reporting PAT growth of 24% YoY to Rs.552 crore (I-direct estimate: Rs.601.6 crore).
Views: The management highlighted that recovery in GM & apparel categories (which yields higher margins) continues to lag that of the FMCG segment. The company’s store addition during the quarter has been strong (17 stores added), which is in line with its target of opening ~40 stores in FY22E. Given its resilient business model and healthy balance sheet we anticipate the company to tide over the current unprecedented scenario.