- 04 Apr 2022
- ICICIdirect Research
Avenue Supermarts reports decent Q4FY22 performance despite headwinds
DMART - 4927 Change: -81.35 (-1.62 %)News: Avenue Supermarts in its Q4YFY22 update reported revenue growth of 18% YoY to Rs 8606 crore (2-year CAGR: 18%). Company displayed decent show despite initial part of the quarter being impacted owing to store restrictions (omicron variant) The key positive highlight was sustained accelerated store addition trajectory as it opened another 21 D-mart stores (added 18 stores in Q3FY22) taking the total store count to 284. As per our calculations, revenue/sq. ft. stood at ~ Rs 7600 vs. Rs 8280 in Q4FY21.
View: Company recorded highest number of store additions in FY22 with opening of 50 D-Mart outlets (FY21: 20, FY20: 38). Revenue grew by ~29% YoY in FY22 (2-Year CAGR: 12% ) which is commensurate with square feet addition of ~29% YoY to ~11.3 million sq. ft. (assuming average store size of 50000). Subsequently, revenue growth was mainly driven by new store additions as SSSG was subdued in FY22. While ease in covid-19 related restrictions may perk up consumer demand, high inflation in certain consumer categories may pose a near term risk. Robust liquidity position and healthy operating cashflows to provide impetus to store addition pace in FY23E
Impact: Neutral