Latest news with #DMartReady
Economic Times
06-05-2025
- Business
- Economic Times
Jignanshu Gor believes DMart doesn't need to join Q-commerce rush. Here's why
Amid rising competitive intensity from quick commerce (Q-commerce) platforms, Avenue Supermarts, the parent company of DMart, is not likely to join the rapid delivery race but is instead expected to sharpen its focus on delivery timelines, assortment depth, and overall value proposition. ADVERTISEMENT In an interaction with ET Now, Jignanshu Gor of Bernstein India addressed the longstanding thesis around DMart's vulnerability to Q-commerce rivals and outlined how the retailer may respond. Gor, whose research house tracks both Avenue and Q-commerce trends, noted that while investor concerns about the overlap between DMart's customer base and quick commerce users have persisted for months, this overlap might be overstated. Addressing the possibility of DMart entering the Q-commerce space directly, Gor stated, 'Will they join them? I do not think so.' Instead, he pointed out that 'they have been working at it for the last nine months, but I do not think they should even plan to join it.' According to him, DMart is more likely to strengthen its delivery capabilities and expand its product assortment, supported by greater investment that one can see in DMart this year or DMart Ready. Gor stated that while Q-commerce will continue to evolve, 'I do not think the entire grocery retailing in India is going to shift online and if it does not shift online, then DMart is one of the two large big box retailers left and arguably given margin profile, etc., the better run retailer as well.' ADVERTISEMENT Also read: Who is Greg Abel and is he able enough to fill Warren Buffett's $1.2 trillion shoes? 'There is a reason why we think that when it comes to pure FMCG or grocery items, a big box retailer is able to provide value, which quick commerce will find it difficult to do on a sustainable basis,' he said. ADVERTISEMENT He acknowledged that the thesis around competition from Q-commerce has been oscillating in the last six months, particularly after DMart's Q2 numbers, which were interpreted by some as indicating pressure from rapid delivery Gor stressed that 'DMart can and will compete better on offering value to customers and offering choice to customers, so that overlap should get over and they will be able to survive or thrive in quick commerce.' (Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)
Time of India
06-05-2025
- Business
- Time of India
Jignanshu Gor believes DMart doesn't need to join Q-commerce rush. Here's why
Amid rising competitive intensity from quick commerce ( Q-commerce ) platforms, Avenue Supermarts , the parent company of DMart , is not likely to join the rapid delivery race but is instead expected to sharpen its focus on delivery timelines , assortment depth, and overall value proposition. In an interaction with ET Now, Jignanshu Gor of Bernstein India addressed the longstanding thesis around DMart's vulnerability to Q-commerce rivals and outlined how the retailer may respond. Gor, whose research house tracks both Avenue and Q-commerce trends, noted that while investor concerns about the overlap between DMart's customer base and quick commerce users have persisted for months, this overlap might be overstated. Addressing the possibility of DMart entering the Q-commerce space directly, Gor stated, 'Will they join them? I do not think so.' Instead, he pointed out that 'they have been working at it for the last nine months, but I do not think they should even plan to join it.' According to him, DMart is more likely to strengthen its delivery capabilities and expand its product assortment, supported by greater investment that one can see in DMart this year or DMart Ready. Gor stated that while Q-commerce will continue to evolve, 'I do not think the entire grocery retailing in India is going to shift online and if it does not shift online, then DMart is one of the two large big box retailers left and arguably given margin profile, etc., the better run retailer as well.' Also read: Who is Greg Abel and is he able enough to fill Warren Buffett's $1.2 trillion shoes? 'There is a reason why we think that when it comes to pure FMCG or grocery items, a big box retailer is able to provide value, which quick commerce will find it difficult to do on a sustainable basis,' he said. He acknowledged that the thesis around competition from Q-commerce has been oscillating in the last six months, particularly after DMart's Q2 numbers, which were interpreted by some as indicating pressure from rapid delivery players. However, Gor stressed that 'DMart can and will compete better on offering value to customers and offering choice to customers, so that overlap should get over and they will be able to survive or thrive in quick commerce.' ( Disclaimer : Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)
Time of India
04-05-2025
- Business
- Time of India
Rising ompetition, staff costs dent DMart's margins, says CEO
Avenue Supermarts reported a 17% increase in net revenue for the quarter ended March, but faced margin pressures due to competition, rising employee costs, and service investments. While overall business remains resilient, the retailer is performing better in non-metro towns. The company is also focusing on store openings and e-commerce expansion. Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads Mumbai: Avenue Supermarts , which operates DMart retail stores, said its gross margins were impacted due to increased competitive intensity in the consumer goods space, rising employee costs and higher investments in service largest listed retailer posted a 17% increase in net revenue at '14,462 crore in the quarter ended March, while net profit rose 3% to '620 crore. In FY25, its total revenue was '57,790 crore, growth of 17% on a net profit increase of 9% to '2,927 crore. The retailer's Ebitda margin was 7.9% during FY25, lowest since FY21."Three things have happened during this quarter-increased competitive intensity in the fast moving consumer space has impacted our gross margins, surge in wages of entry-level positions due to demand and supply mismatch of skilled workforce; and continued investments in improving our service levels with respect to faster turnarounds on availability, checkouts and future store openings," Neville Noronha , chief executive of Avenue Supermarts , said in its earnings statement, adding that overall gross margins in the matured metro towns will remain soft for a certain period of company also had higher store openings during the quarter with 28 new doors last quarter and 50 outlets in FY25. The company said its overall business continues to be resilient in metro towns, but it is doing significantly better in non-metro January, the company announced that Anshul Asawa will replace Noronha in February 2026, after the latter chose not to continue. At present, Asawa is going through a detailed familiarisation and understanding of the organisation, and should be taking charge of all operational aspects of the retail business in another 4-5 months."This will allow me to dedicate more time on store-opening acceleration, ecommerce capacity build-up and other non-retail aspects of the business," said Noronha. The firm said profitability for its standalone online segment under DMart Ready could be some time away.
News18
22-04-2025
- Business
- News18
Trent, DMart, HUL Lead UBS' Top Consumer Stock Picks On Demand Rebound In FY26
UBS has turned optimistic on India's consumer sector; On the downside, it maintained 'Sell' ratings on Asian Paints, Dabur, Jubilant FoodWorks UBS has turned optimistic on India's consumer sector, forecasting a 13% earnings growth for FY26 and naming Avenue Supermarts (DMart), Trent, and Hindustan Unilever (HUL) as its top stock picks. The brokerage has upgraded several stocks in the space, banking on a demand rebound, easing input costs, and expected income boosts from potential tax cuts and the upcoming Eighth Pay Commission. UBS noted that consumer stocks have underperformed the broader market during both the recent rally and ongoing correction, which has brought valuations to more attractive levels. The current market conditions, it said, present a 'goldilocks" scenario—favourable for a turnaround. The firm believes FY26 could be an inflection point for the sector, supported by cyclical earnings recovery and improving macro fundamentals such as falling inflation, rising rural wages, and fiscal stimulus measures. Among its top picks, UBS highlighted Avenue Supermarts and Trent as strong 'income stimulus plays," with robust value retail models poised to benefit from increased disposable incomes. DMart, which last traded at Rs 4,357, has been given a target price of Rs 5,200—indicating a 19% upside. Trent, trading at Rs 5,131, was assigned a target of Rs 6,200, suggesting a 21% potential gain. UBS said DMart is ramping up store expansion and enhancing its e-commerce platform, DMart Ready, to align with the shift towards quick commerce. It expects DMart to deliver a 20% revenue CAGR and 25% EPS CAGR from FY25 to FY27. Trent, which runs the Zudio and Westside retail chains, is seen benefiting from aggressive expansion into tier-2 and tier-3 cities. UBS projects a 29% revenue CAGR and 36% EPS CAGR for the company over the same period. For turnaround potential, UBS is backing Hindustan Unilever. Once a sector leader, HUL has recently lagged, but the brokerage sees room for a comeback. It expects volume growth to recover to 6-7% in the second half of FY26, supported by falling input costs and a refreshed strategic focus under its new global CEO. The stock, currently at Rs 2,375, has a target price of Rs 2,800. Additionally, UBS upgraded Colgate-Palmolive, Godrej Consumer Products (GCPL), and ITC to 'Buy'. It sees Colgate regaining share in oral care while recovering from a strategic margin reset, and expects GCPL to benefit from product innovation in insecticides and stronger global performance. ITC, meanwhile, is viewed as attractively valued following a recent correction driven by tax-related concerns. UBS believes the current price reflects conservative growth expectations. On the downside, the brokerage maintained 'Sell' ratings on Asian Paints, Dabur, and Jubilant FoodWorks. It cited ongoing margin pressures and competition at Asian Paints, weak growth visibility at Dabur, and limited upside at Jubilant despite improving same-store sales. UBS concluded that the consumer sector is emerging from a weak phase and is ripe for rerating as both cyclical and structural headwinds begin to ease. While it slightly trimmed its FY26 GDP growth forecast for India to 6%, it believes the impact on consumption will be minimal, particularly in categories like packaged foods, quick service restaurants, and value retail. Disclaimer:Disclaimer: The views and investment tips by experts in this report are their own and not those of the website or its management. Users are advised to check with certified experts before taking any investment decisions. First Published:
Time of India
22-04-2025
- Business
- Time of India
DMart, Trent, HUL among top UBS picks as brokerage bets on consumer sector rebound in FY26
UBS has turned bullish on India's consumer sector, projecting 13% earnings growth for FY26 and naming Avenue Supermarts , Trent , and Hindustan Unilever as its top stock picks. The brokerage upgraded multiple stocks in the space, betting on a rebound in demand, easing input cost pressures, and income stimulus from tax cuts and the forthcoming Eighth Pay Commission. UBS said the consumer sector has lagged the broader market both in the recent rally and the ongoing correction, which has left valuations looking reasonable, calling the current setup a 'goldilocks' scenario. The brokerage expects FY26 to mark a turning point for the segment, driven by a cyclical earnings recovery and improving fundamentals such as falling inflation, rural wage growth, and fiscal stimulus. Among its preferred picks, UBS favours Avenue Supermarts (DMart) and Trent as 'income stimulus plays' with resilient value retail models that could benefit from rising disposable incomes. DMart, trading at Rs 4,357, was assigned a target price of Rs 5,200 — implying 19% upside — while Trent, last at Rs 5,131, was given a Rs 6,200 target, suggesting 21% potential gains. The brokerage mentioned that DMart is accelerating store expansion and investing in its e-commerce platform, DMart Ready, to adapt to the rise of quick commerce. It expects a revenue and EPS CAGR of 20% and 25%, respectively, for DMart between FY25 and FY27. Trent, which operates the Zudio and Westside retail chains, could benefit from strong store rollout plans and untapped potential in tier-2 and tier-3 cities, according to the brokerage. UBS models a 29% revenue CAGR and 36% EPS CAGR over FY25- 27 for Trent. Among turnaround bets, Hindustan Unilever is a key idea. Once a sector bellwether, HUL has become a laggard in recent years, but UBS sees a recovery ahead. The brokerage expects volume growth to recover to 6-7% in the second half of FY26, aided by easing input costs and a renewed portfolio focus under the new global CEO. The stock, last trading at Rs 2,375, has been given a target price of Rs 2,800. UBS also upgraded Colgate-Palmolive , Godrej Consumer Products (GCPL) and ITC to 'Buy'. The brokerage said it sees Colgate gaining market share in oral care and recovering from a deliberate margin reset, while GCPL is seen benefiting from new product cycles in insecticides and stronger performance in international markets. ITC, UBS said, offers attractive value after its stock corrected on tax fears, with conservative expectations built into its current valuation. Also read | Going contra? IT's time has not come; stick to consumer, infrastructure stocks: Sandip Sabharwal On the other end, Asian Paints , Dabur and Jubilant Foodworks were rated 'Sell' by UBS. It flagged persistent competition and margin pressure at Asian Paints, weak growth visibility at Dabur, and an already-priced-in recovery at Jubilant, despite positive same-store sales growth trends. The brokerage said it believes the broader sector is emerging from a weak phase and could see a rerating as cyclical and structural challenges fade. Despite a slight cut in India's FY26 GDP growth estimate to 6%, UBS said the impact on consumption would be limited, especially as packaged foods, QSR and value retail stand to benefit from the stimulus.
