D-mart Shares Nose Dives 9.4% On NSE After Weak Q2 Results

The shares of D-Mart's parent company, Avenue Supermart, tumbled down more than 9 per cent after Q2 result; the stock tumbled on monday, october 14.

The Dmart shares rang the opening bell at Rs 4,204.00 per share on the National Stock Exchange (NSE). Soon after, the stock went down in a rabbit hole of decline, eventually touching the day-low of Rs 4,139.95 per share on NSE.

The stock has touched a 52 week low of Rs 3,620.00 on October 23, 2023. Dmart shares were trading at Rs 4,192.80 per share on the National Stock-Exchange.

Dmart Q2 FY25

Net profit and operating revenue

Compared to the same period last year, Avenue Supermarts' consolidated net profit increased by 5.78 per cent to Rs 659.44 crore in the July-September quarter of FY25, from Rs 623.35 crore.

From Rs 12,624.37 crore in Q2 FY24 to Rs 14,444.50 crore in Q2 FY25, the retail chain's operating revenue increased by 14.41 per cent.

In the quarter under revenue, the company's total expenses climbed 14.9 per cent to Rs 13,574.83 crore, while its total income increased 14.34 per cent year over year (YoY) to Rs 14,478.02 crore.

JP Morgan rating

JPMorgan lowered its target price from Rs 5,400 to Rs 4,700 and downgraded its rating from overweight to neutral.

They stated that DMart's performance is being impacted, especially in big cities, by growing expenses and competition from online grocery platforms. This has negatively impacted its margins, as has a slower rate of growth in its current stores.

Morgan Stanley

Morgan Stanley took a more cautious approach, downgrading the stock from overweight to underweight with a big cut in the target price—from Rs 5,769 to Rs 3,702.

The firm noted that DMart’s sales and profit margins were weaker than expected, and the growing competition from online grocery stores could make it hard for DMart to achieve its 20% growth target.