Avenue Supermarts, the country’s second-largest organised retailer, will double down on store expansion with a focus on northern India to counter heightened competition from online and offline retailers. The Mumbai-headquartered company, which runs DMart supermarket chain, will add as many as 50 stores this financial year, CEO & MD Neville Noronha said on Wednesday.
“If there was anything I could have done better during my tenure, it would have been increasing the number of stores… We should have been at 600-650 stores by now,” Noronha, who will step down from his position in January 2026, said in an investor call. The company ended FY25 with 415 stores. In comparison, Reliance Retail had 19,340 stores.
Future Outlook
Noronha, however, played down the threat from quick-commerce, and said the company would not get into 30-minute home deliveries. Instead, the company will focus on three-to-six-hour deliveries through DMart Ready, its online platform, as it seeks to give preference to value over convenience. His comments sent the shares of Avenue Supermarts soaring over 6% intra-day on the bourses. The stock finally closed at Rs 4,285.15 apiece on the BSE, up 7.11% versus the previous day’s close — its highest single-day surge since February 1, 2025.
The grocery retailer, which began its journey in Mumbai in 2002, has a strong presence in the west and south of India. It has now set its sights on the north.“We now remain bullish on store expansion. And I will drive this for the period I am here, with a focus on the northern markets, notably Uttar Pradesh,” he said.
The retailer’s quest for geographic expansion and sales growth would see it reduce its focus on margins, Noronha said, adding that the company was building a “unique online model that was hard to copy” with DMart Ready.“We respect what quick commerce has done for the retail business in the last two years. But if you will look at the financial performance (of our online business), you will understand where we stand. We delivered 20-21% year-on-year sales growth in FY25 and hope to reach break-even in the next few years. We are clear that we want to build our own online model that is profitable,” he said.
Anshul Asawa, who will take over the reins of Avenue Supermarts from Noronha in January next year, also laid stress on geographical expansion. “The fundamentals and culture of this organisation does not need to change. Yes, there are opportunities to improve and accelerate. What I see is a strong business that needs to be scaled up, a business that needs to have capabilities that are spread across more geographies,” the CEO-designate told investors.
Avenure Supermarts Financials
Avenue Supermarts closed FY25 with revenue of Rs 57,790 crore, registering a growth of 17% over FY24. In the first quarter of FY26, it has added 11 stores, including a store each in Agra and Ghaziabad in Uttar Pradesh. In comparison, Reliance Retail added 388 stores during the quarter, taking its total to 19,592.
Avenue E-Commerce, a subsidiary of Avenue Supermarts, closed FY25 with sales of Rs 3,502 crore, up from Rs 2,899 crore in FY24. But losses have grown to Rs 247 crore in FY25 from Rs 185 crore in FY24 as the company expanded its operations to 25 cities from 23.
The company’s net cash flows have grown by just 16% in two years from Rs 3,113 crore to Rs 3,724 crore versus a doubling of cash flows in the previous two-year period (Rs 1,540 crore in FY21 to Rs 3,113 crore in FY23), implying that the company has been investing aggressively in both online and offline operations. A growth in the retail business has also seen operating margins of Avenue Supermarts slip to levels of 7.9% in FY25 from 8.7% in FY23 and 8.3% in FY24 as wage bills and overheads increase.