Even as global markets grapple with inflation concerns, weak monsoons, and find themselves at the mercy of the West Asia war, the tides are yet to fully turn against Indian retailers.
Anand Agarwal, V-Mart's Chief Financial Officer (CFO) told NDTV Profit that contrary to initial concerns regarding weak monsoons and tightened liquidity, the traction on ground has been quite good.
"I think we are seeing good traction on the ground. We were actually a bit worried that monsoons are not so strong this year. But contrary to the you know the worries, we have seen reasonably good amount of sales happening. We have seen reasonably good amount of footfalls happening and they continue to happen," the CFO said during the interview.
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Notably, shift of the festive season from quarter two to quarter three has impacted Q2 a bit but despite that, the company had reasonable same store sales growth in last quarter, which is 3%, "but we are continuing to see you know reasonable amount of traction on the ground and we are quite optimistic on how the rest of the year is going to go ahead," he stated.
The CFO said that an earlier guidance of a flat or even a negative same store sales growth for quarter two makes him positive about how the final SSSG rate.
"On top of that, if we have a 3% positive, that's a good number to begin with. And that's the state across the industry. It's nothing to do with only with V-Mart, but I think that's the state of the market because the festive shift has happened for all," Agarwal underscored.
He flagged that while there are challenges for their medium to long-term perspective, he said cost pressure has fairly been well mitigated as far as quarter three is concerned.
Fourth Quarter To Be A Fight?
The CFO emphasised that Vmart has been very careful not to pass on a significant price hike to the customer because the customer is already impacted by high inflation, but at the same time would be careful not really take a hit on its own margins
"We will maintain the margin at least from a percentage perspective," Agarwal stated.
However, he said that the fourth quarter of this fiscal might be a bit tough, and may see some price hikes, depending on the geopolitical situation and oil prices.
"We are continuing to see hardening of oil pricing... From quarter four onwards, if the oil price pressure continues to remain where it is, we will need to take some more price hikes," Agarwal outlined.
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