DMart share price: Radhakishan Damani portfolio stock surges 15% after Q3 business update. Should you buy?

DMart share price: Avenue Supermarts (DMart) share price surged 10 per cent to hit its upper circuit in the opening trade on Friday, January 3, following a strong business update for the third quarter of the financial year 2024-2025 (Q3FY25).

The company said its standalone revenue from operations in the recently concluded quarter stood at ₹15,565.23 crore, up 17.49 per cent compared to ₹13,247.33 posted in the corresponding quarter last year. The figure is also higher than the revenues posted in the preceding three December quarters.

The company added 10 stores during the quarter, taking its total store count to 387 from 377 in the September quarter.

Avenue Supermarts is a Radhakishan Damani portfolio stock. The ace investor holds a 37.22 per cent stake as of the September 2024 quarter shareholding pattern. Damani is also categorised as a company promoter. At the end of the September quarter, he held 24.22 crore shares.

Stock Impact

Following the strong earnings announcement, Avenue Supermarts share price surged 15 per cent to ₹4,160.40 apiece on the BSE.

The stock opened at ₹3,790 on the BSE, 4.76 per cent higher than its previous close of ₹3,617.75 crore. Soon after, it extended gains to trade at ₹4,160.40.

Despite today's sharp surge, Avenue Supermarts share price is still 32 per cent away from its 52-week high of ₹5,484 scaled in September 2024. However, the stock is trading over 22 per cent higher than its 52-week low of ₹3,400 hit in December 2024.

Should you buy?

DMart reported standalone revenue growth of 17.5% YoY to ₹156 billion, higher than our estimate of ~15% YoY growth, driven by 13% YoY store addition and likely high single-digit same-store sales growth (SSSG), said brokerage Motilal Oswal Financial Services (MOSL). After a relatively weaker 2Q, the revenue growth recovered to the 17-20% YoY range, it added.

Ramp-up in store additions remains the key growth driver for DMart, said MOSL. It is building in ~18 store additions in the March quarter, which would bring the total store additions to 40 in FY25.

The brokerage has a BUY rating on DMart with a target price of ₹5,300.

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