Avenue Supermarts Ltd, the operator of the DMart retail chain, experienced a share price decline of approximately 4% following the release of its first-quarter business update. The update, revealed on Wednesday, projected a 16% year-on-year revenue growth for the first quarter of fiscal year 2026. Standalone revenue for the April-June period is estimated to reach ₹15,932.1 crore. As of June 30, 2025, DMart operates 424 stores across India.

Key Highlights from the Q1 Business Update:

• Revenue Growth: The company anticipates a 16% increase in revenue compared to the same period last year. The standalone revenue for Q1 FY26 is expected to be ₹15,932.1 crore.
• Store Count: DMart's retail chain has expanded to 424 stores across India as of June 30, 2025. This includes one store in Sanpada, Navi Mumbai, Maharashtra, which is currently closed for renovation.
• Expansion: DMart recently opened its first major store in Uttar Pradesh, located in Agra. Morgan Stanley views this expansion as a positive step, noting the significant opportunity for further store openings in the state. DMart follows an ownership model for its stores and focuses on a cluster-based approach to expansion, increasing penetration in existing areas before venturing into new regions.

Analyst Ratings and Market Sentiment:

According to Bloomberg data, among the 31 analysts tracking Avenue Supermarts, nine have a 'buy' rating, nine recommend a 'hold,' and 13 suggest a 'sell'. The average 12-month consensus price target implies a potential downside of 8.8%. Morgan Stanley has maintained an 'underweight' rating on Avenue Supermarts with a target price of Rs 3,260.

Previous Financial Performance:

In the fourth quarter of fiscal year 2025, Avenue Supermarts reported a consolidated net profit of ₹551 crore, compared to ₹563 crore in the same quarter of the previous year. The PAT margin stood at 3.7% in Q4 FY25, versus 4.4% in Q4 FY24. The total revenue for the quarter ended March 31, 2025, was ₹14,462 crore, up from ₹12,393 crore in the corresponding period last year. EBITDA was ₹981 crore, compared to ₹940 crore in the same quarter of the previous fiscal year, while the EBITDA margin was 6.8% in Q4 FY25, against 7.6% in the corresponding period.

Other Recent Developments:

Avenue Supermarts announced a management reshuffle, with Anshul Asawa of Unilever appointed as CEO Designate. Neville Noronha, the current Managing Director and CEO, will step down in January 2026.

Stock Performance:

The shares of Avenue Supermarts closed 1.22% lower at ₹4,398 per share on Wednesday, July 2. Over the past 12 months, the stock has fallen 7.87%, but it has risen 23.48% year-to-date.