D-Mart parent's profit up 48%

Company's total revenue rose 36% to Rs 3,598 crore in Q1FY18

In its second quarterly earnings since listing, Avenue Supermarts, the operator of D-Mart stores, posted a 48 per cent jump in its net profit for the first quarter of the current financial year at Rs 175 crore on the back of strong sales growth.

The company’s total revenue rose 36 per cent to Rs 3,598 crore in Q1FY18.

However, the company’s EBITDA margins came down to 8.4 per cent in Q1FY18 from 8.8 per cent in Q1FY17. 

Avenue Supermarts’s earnings before interest, tax, depreciation and amortisation (EBITDA) in Q1 FY18 stood at Rs 303 crore, up 29.2 compared to Q1FY17.

The organised retail business of Reliance Industries (RIL) posted Rs 398-crore profit before depreciation, interest and taxes (PBDIT) at Rs 398 crore in the quarter ended June, a 66 per cent annual jump at the back of record sales growth of 73.6 per cent to Rs  11,571 crore in the period. 

“GST has had an impact the business with vendors not able to supply properly initially. But there has been a rapid improvement. In a week or so, we expect things to normalise,” said Neville Noronha, CEO & managing director, Avenue Supermarts.

Noronha said the EBITDA margins fell due to fall in gross margins. “There was price discounting in the market and we being value retailer wanted to maintain our position,” he said.

The company opened one store in Q1FY18. Norohna said the company normally expands faster in the last quarters of the financial year. The company had 132 stores with retail area of 4.1 million square feet as on June 30.