Shoppers Stop surges 18%, hits 52-week high on strong Q3 earnings

Shares of Shoppers Stop hit a 52-week high of Rs 420, on surging 16 per cent on the BSE in Friday’s intra-day trade after the company reported a strong operational performance with earnings before interest, taxes, depreciation, and amortization (ebitda) margins improving by 580 bps year-on-year (YoY) to 19.2 per cent in December quarter (Q3FY22).

The company said EBITDA performance driven by robust demand recovery and tight control on costs, while E-commerce sales continue to grow rapidly, up by 39 per cent. The company is now net debt free again.

The stock surpassed its previous high of Rs 408.70 hit on November 9, 2021. At 09:35 am; it was up 15 per cent at Rs 415.85, as compared to 0.83 per cent decline in the S&P BSE Sensex. The trading volumes on the counter jumped an over three-fold with a combined 2.1 million equity shares changing hands on the NSE and BSE.

In Q3FY22, Shopper’s Stop revenue grew by 35 per cent YoY to Rs 1,070 crore. Healthy demand owing to strong festive and wedding season resulted in the company reaching close to pre-covid levels in Q3FY22. The company on a net basis added three stores during the quarter taking the total store count to 83 (4.0 million sq. ft.). The company reported profit after tax (PAT) of Rs 50 crore in Q3FY22, against loss of Rs 21 crore in Q3FY21.

The management said the company has seen a sustained demand during the festive period and the marriage season in October and November. The company witnessed a high customer spend and a higher Average Transaction Value (ATV). “Encouraged by the strong rebound, the Company expects an accelerated growth trajectory now, driven by a robust recovery from the lockdown blues, accelerated small size store expansion, growth in the private-label mix, and an increased focus on high growth beauty business. The third wave may cause a small blip in the growth trajectory,” the company said.