Avenue Supermarts share price jumps over 5% to hit 52-week high after strong Q4 business update

Avenue Supermarts share price jumped over 5% to a 52-week high on Wednesday after the company reported strong growth in business for the fourth quarter of FY24. DMart shares rallied as much as 5.61% to a fresh high of ₹4,710.15 apiece on the BSE.

Avenue Supermarts, the operator of DMart stores, reported a standalone revenue of ₹12,393.46 crore for the quarter ended March 2024, registering a growth of nearly 20% from ₹10,337.12 crore in the same quarter last year.

The company’s revenue growth during the quarter was driven by 7% growth in revenue per store and a robust 13% year-on-year (YoY) increase in store additions.

Also Read: HDFC Bank share price gains 3% as Q4 gross advances rise 55% YoY to ₹24.69 lakh crore; deposits grow 26%

Revenue per store has grown 7% YoY to ₹140.4 crore, while revenue per sq.ft. has grown around 5% YoY to ₹33,451 per sq.ft, and hence, the gap between revenue per store and revenue per sq. ft. stood at 2%, according to brokerage firm Motilal Oswal.

Earlier, foreign brokerage CLSA initiated coverage on the Radhakishan Damani-led Avenue Supermarts with a ‘Buy’ rating and a target price of ₹5,107 per share citing growth opportunities.

CLSA sees the total addressable market (TAM) growing to $2.3 trillion in 25 years, with DMart’s share rising to 5% from less than 1% at present. It believes private labels can be a key differentiator, especially when compared with e-commerce and quick commerce.

Read here: DMart share price extends rally for fifth session, up over 7% this week; CLSA initiates coverage with a ‘Buy’ call

“DMart is rapidly scaling its private-label offerings, which could drive the next leg of share gains,” CLSA said.

DMart is a discount retailer in India’s $500 billion urban food and grocery market with the lowest operating costs. This has driven the lowest consumer prices and led to high sales velocity and better scale, further reducing costs. This has allowed DMart to gain market share in a price-sensitive market, CLSA noted. 

DMart share price has gained over 20% in the past one month and more than 30% in one year.

At 10:25 am, Avenue Supermarts shares were trading 4.05% higher at ₹4,640.05 apiece on the BSE.

Catch Stock Market Live Updates here

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.