Avenue Supermarts (D\u2019mart), India\u2019s profitable food & grocery (F&G) retailer, is amongst the few retailers which has not only cracked the retail business model, but also sustained >20% same stores sales growth (SSSG). Commendably, D\u2019mart has maintained its inventory turnover at an impressive ~30 days (peers at >75 days) due to the sharp focus on everyday consumption items. With good getting better, we expect D\u2019mart to clock revenue, EBITDA and PAT CAGR of 28.1%, 32.1% and 41.4%, respectively, over FY17-20. We also expect RoE to improve by ~350bps over FY17-20. However, considering that stock is fairly valued, we initiate coverage with \u2018HOLD\/SU\u2019 and assign 35x EV\/EBITDA multiple (~40% premium to FRL\u2019s target multiple) to arrive at TP of Rs 1,290. Retail entails having the right format, scale, size and execution strategy, and D\u2019mart clearly has impressive credentials and prowess in all these mentioned aspects. In spite of its capital-intensive model (works on ownership model instead of lease model), D\u2019mart not only clocks best-in-class EBITDAR margins (8.5% versus peers\u2019 average of 6.6%) and RoCE, but has also managed its leverage ratio (debt to equity at 0.3x) well. Finally, gross margins (~15%) may be low, but D\u2019mart has sustained EBITDA margins at ~8% levels, a sheer outcome of strong inventory throughput and tight leash on costs. During FY13-17, D\u2019mart clocked revenue, EBITDA and PAT CAGR of 37.4%, 46.2% and 50.3%, respectively. Drawing on proven execution capabilities, sustained >20% SSSG, stable stores expansion, humongous store expansion opportunities (68% of stores in only 2 states) and steady margin booster, we expect D\u2019mart to register revenue, EBITDA and PAT CAGR of 28.1%, 32.1% and 41.4%, respectively, over FY17-20. Key growth catalysts are: customer loyalty; likely shift of consumers towards mall like organised shopping experience; and introduction of private labels. While we aver that D\u2019mart is a perfect play on the Indian retail story, we abide by Warren Buffet\u2019s admonition - an investor should understand that \u201cPrice is what you pay, value is what you get\u201d. Hence, with limited upside from current levels (31.4x FY20E EV\/EBITDA), we initiate coverage with \u2018HOLD\/SU\u2019 and TP of Rs 1,290.