1. D-Mart parent Avenue Supermarts Q4 profit up 47.4 per cent to Rs 97 crore

D-Mart parent Avenue Supermarts Q4 profit up 47.4 per cent to Rs 97 crore

Avenue Supermarts, parent of retailer D-Mart, is likely to go slow on expansion in the coming years as acquiring quality space at a reasonable price for its stores is a challenge.

By: | Mumbai | Published: May 7, 2017 4:36 AM
Avenue Supermarts on Saturday reported a rise of 47.4% year-on-year growth in its net standalone profit to Rs 97 crore in Q4FY17.

Avenue Supermarts, parent of retailer D-Mart, is likely to go slow on expansion in the coming years as acquiring quality space at a reasonable price for its stores is a challenge. It is a challenge for the company to keep adding stores at the same rate, said chief executive officer Neville Noronha.

The company mostly owns the stores or have expanded through long-term leases. Refusing to give any specifics on expansion and forward looking guidance Noronha said the company will be cautious in its approach towards expansion. The company is also running a pilot on online presence and depending on the response would expand it in the future. At present the retailer has 131 stores operational in the country of which 14 stores were opened in the last three months.

Avenue Supermarts on Saturday reported a rise of 47.4% year-on-year growth in its net standalone profit to Rs 97 crore in Q4FY17. In Q4FY17 total revenue of the company was up 40.5% year-on-year to Rs 3,120.5. D-Mart’s Earnings before Interest, Tax, Depreciation and Amortization (EBITDA) in Q4FY17 was up 41% year-on-year to Rs 217 crore. Noronha said, “March quarter and financial year 2016-17 annual results has been in line with our expectations.”

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However, the company’s like-to-like growth in FY17 remained at similar levels of just 21%. Sales Revenue per sq ft increased from Rs 28,136 per sq ft in FY16 to Rs 31,120 per sq ft in FY17.

The total debt of the company stands at around Rs 1,480 crore as of March 31, 2017 and the company plans to repay debt of Rs 1080 crore over a period of three years.

D-Mart focuses on selling food, staples, and beverages which makes up more of that half of its total sales. This is a high volume segment but also bring in lowest margins. In FY17 Foods category constituted 53.65% of the total revenue, as compared to 53.02% of FY16. Non-food (FMCG) constituted 19.98% of the total revenue, as compared to 20.60% of FY16 and general Merchandise and Apparel constituted 26.37% of the total revenue in FY17, as compared to 26.38% of FY16.

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