DMart Q4 Results Preview: Retail firm likely to report healthy numbers; margins may see minor pressure

Avenue Supermarts, which operates under the brand name DMart, is expected to report decent financial earnings for the quarter ended March 2023, on Saturday, May 13, 2023. The top line may register double-digit percentage growth, while margins are expected to see marginal pressure in Q4.

According to Zee Business research, DMart – a retail chain company – is likely to report revenue of Rs 10,337 crore for the last three-month period of the previous fiscal, which translates to growth of 20 per cent compared to Rs 8,606 crore in the corresponding quarter a year ago.

The market veteran Radhakishan Damani-promoted company’s profit is estimated at Rs 495 crore for the March quarter of the financial year gone by, as against Rs 466 crore for the year-ago period.

The analysts peg DMart’s earnings before interest, taxes, depreciation, and amortisation (EBITDA) – a measure of the company's overall financial performance – at Rs 799 crore for the three-month period, marking a marginal jump of 8 per cent against Rs 742 in the same quarter a year ago.

They estimate Avenue Supermarts' margin – a key measure of a business's profitability – at 8 per cent, a dip of 100 basis points mainly due to higher inflation and aggressive store expansion.

In line with Zee Business research estimates, ICICI Direct also expects the Radhakishan Damani-owned company may report healthy numbers for the March-end quarter of FY23.

The brokerage believes, “revenue/sq ft for D-Mart is expected at Rs 7,600, down 8-10 per cent pre-Covid levels and store addition was robust as the company added 18 new stores in Q4FY23 taking the total store count to 324.”

The analysts at ICICI Direct said, “Gross margin enhancement would be the critical factor to watch as the management in the previous quarter had indicated that inflationary stress was more acute at lower price points in discretionary non-FMCG categories.”

DMart shares on Friday were flat with negative bias at Rs 3,688.40 per share ahead of the Q4 earnings tomorrow.