DMart Q2 Preview: PAT may rise 13% YoY; revenue growth to be driven by store expansion

Leading retail supermarket operator DMart is expected to put up a steady show in the second quarter, when it will announce its earnings on October 12.

The company's consolidated revenue from operations are likely to grow 14% year-on-year, according to an average estimate of five brokerages. The revenue growth will be mainly on the back of healthy store addition.

DMart has already reported that its standalone revenues grew 14% and added 6 stores in the second quarter ended September 2024.


Net profit for the same period may rise 13% year-on-year, an average estimate of four brokerages showed.

In the preceding June quarter, the company clocked 17% growth in its net profit at Rs 774 crore, while revenues jumped 19% to Rs 14,069 crore.

Here's what brokerages expect from DMart's Q2:

Antique stock broking

DMart's revenue to grow at 14% YoY driven by higher inflation and store expansion. On a five-year CAGR basis (pre-Covid-19 levels), revenue is expected to grow at 18.9%. We expect a marginal improvement in the sale of general merchandise as consumer sentiment improves. We expect DMart's EBITDA margin to improve marginally over last year's level due to operating leverage.

Nuvama

Avenue Supermarts (DMart), in Q2FY25, reported a 14% YoY growth in standalone revenues with an addition of 6 stores. We expect DMart to report a gross margin of 14.4% stable GM&A mix. This leads to an EBITDA margin estimate of 8.4% with EBITDA at Rs 1190 crore, up 18% YoY. PAT is expected to increase 19% YoY to Rs 790 crore.

Motilal Oswal

Consolidated revenue is expected to grow 15% YoY. Standalone revenue/sq ft is expected to grow 4% YoY to Rs 36,200. DMart added 6 stores in 2QFY25, taking its total store count to 377. Expect PAT to grow 18% YoY.

Kotak Equities

We model consolidated revenue growth of 14.4% YoY in 2Q (company update indicated 14.2% YoY standalone revenue growth), driven by the addition of 6 stores and single-digit SSSG. We note that Dmart added 6 stores in 2QFY25.

We expect consolidated GM of 14.7% (flat YoY) and EBITDA margin of 7.6%. We expect gross margin to contract 90 bps QoQ and EBITDA margin to contract 110 bps, driven by unfavorable seasonality. Lower-than-expected revenue growth drives negative fixed cost operating leverage and YoY margin compression.

Axis Securities

Consolidated revenue is expected to grow at 14% YoY on back of store expansion ; EBITDA margins to decline on account of slowdown in overall revenue growth.

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