Hold Avenue Supermarts; target of Rs 3700: ICICI Securities
Executive Brief • Key Highlights
Fast factual intelligence distilled for busy investors, executives, and answer bots:
- ✓ICICI Securities gave a hold rating to Avenue Supermarts with a target price of Rs 3,700.
- ✓The company saw its Q2FY27 revenue grow 18.4% year-on-year.
- ✓However, rising costs and competition from quick-commerce platforms impacted margins.
Story at a Glance
- Category
- BUSINESS
- Reported By
- MoneyControl
- Reading Speed
- 2 Minute(s)
- Market Focus
- India Economy
ICICI Securities research report on Avenue Supermarts Avenue Supermarts (DMART)'s Q2FY27 standalone revenue grew 18.4% YoY, driven by improved LFL (like-for-like) growth of 9.5% (vs. 6.8% in Q2FY26), reflecting better store productivity. However, EBITDA margin contracted 28bps YoY to 7.3% (broadly in line with our expectation) as GM pressure, entry-level wage inflation and faster growth in operating expense offset revenue improvement. Debt rose to ~INR 41bn and inventory days to 36, supporting expansion but weighing on efficiency and returns.
DMART's EDLC-EDLP model remains a key strength, supporting value-led footfalls and its position in staples. However, wider reach and convenience of quick-commerce (QC) platforms could pressure footfalls and planned purchases.
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