The December 2025 quarter results of Avenue Supermarkets, which operates the Dmart retail chain, were keenly awaited by investors on Dalal Street.
This was for two key reasons. –
One, to get a glimpse into whether Dmart can withstand the fast growth of quick commerce and stay ahead.
Two, to get a sense of the trends in spending of the Indian consumer, given the earlier GST cuts to 5% levels on most items consumed daily.
Let’s dig into the numbers to see how the company scored on these parameters, and more.
Q3 FY26 – sluggish growth in sales and tight check on costs
Avenue Supermarket has highlighted that like-for-like growth was 5.6% in the December 2025 quarter vis-à-vis 8.3% a year earlier, for stores that have been operational for at least 24 months at the end of reporting period.
This shows that growth decelerated in the quarter under review and once again raised doubts on the much-anticipated upturn in consumer spending.
The company in its press release highlighted revenue growth was partially impacted due to deflation in staples – broadly referring to lower prices of most daily use items, given recent GST cuts on most daily items.
Whether some of this was also due to competition from q-commerce and other large format retailers will be known only once more information becomes available.
In contrast, in the September 2025 quarter, the company had highlighted that it’s like-for- like growth was 6.8% vis-a-vis 5.5% in the September 2024 quarter.
On a consolidated basis, however, the company appears to have posted relatively strong double-digit numbers.
The retailer’s consolidated revenue from operations grew 13.3% y-o-y to Rs 18,101 crore in the December 2025 quarter. A tight check on its costs helped its operating profit margin expand 40 basis points y-o-y to 8.1 per cent in Q3FY26.
The company’s consolidated net profit grew 18.3% y-o-y to Rs 855.8 crore in the December 2025 quarter
In terms of footprint, the retailer continues to make progress.
DMart’s retail business area was 18.3 million sq feet at the end of the December 2025 quarter vis-à-vis 16.1 million sq ft a year earlier. The retailer highlighted that it added 10 stores in the third quarter of FY26. Its store network has reached 442 stores on a pan India basis at the end of the quarter under review.
Rival Trent – sales growth in tune with earlier quarters and rapid store expansion
Meanwhile, Trent, which operates Westside and Zudio among other brands, in its business update for the December 2025 quarter has highlighted that its standalone revenue from sale of products (including GST) grew 17% on a y-o-y basis to Rs 5,220 crore.
Trent in the September 2025 quarter had grown its standalone revenue from operations by 17.1% y-o-y to Rs 4,724 crore.
It opened a net of 17 Westside stores and 48 Zudio outlets in the December 2025 quarter.
Trent had 1,101 stores at the end of September 2025 quarter with an area of nearly over 14 million sq ft vis-a-vis 907 stores a year earlier with an area of over 11 million sq ft.
Investors on Dalal Street – high valuations for retail chains
Investors will be keeping a close eye on the growth strategy of the new CEO and MD of Avenue Supermarket, Anshul Asawa, when he assumes office on 1 February. Among other things, investors and analysts will be keen to know his strategy to accelerate growth, going forward.
The Avenue Supermarket stock gained 0.4% on Friday to Rs 3,805. The stock trades at a consolidated P/E of more than 90 times.
Meanwhile, Trent ended Friday trade 0.3% lower at Rs 3,975 and hovering just above its 52-week low of Rs 3,931.5 that was reached on 9 January, 2026. This stock trades at a consolidated P/E of more than 85 times.
Both these leading retail chains have traded at very high valuations. However, with mediocre growth trends, investors are increasingly reevaluating the valuations for these stocks.
Amriteshwar Mathur is a financial journalist with over 20 years of experience.
The writer and his family have no shareholding in any of the stocks mentioned in the article.
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