Avenue Supermarts Q4 Review: Citi Hikes Target On Temporary Demand Spike Amid Profit Beat

Avenue Supermarts Q4 Review: Ace investor Radhakishan Damani-backed Avenue Supermarts which operates the retail chain DMart announced its January-March quarter results for fiscal 2025-26 on Saturday, May 2, 2026 and reported a strong performance driven by consistency across segments. The hypermart chain operator beat D-Street estimates with a 19% rise in net profit to Rs 657 crore, compared to Rs 551 crore in the corresponding period last year. After the Q4 beat, brokerages have maintained a bullish stance on the FMCG stock and expect consistency in performance for the near-term despite headwinds.

Global brokerage Citi has hiked its target price for DMart from Rs 3,150 to Rs 3,650 after temporary demand spike during March amid the geopolitical tensions drove business for the fourth quarter of FY26. In its analysis, Citi highlighted that analysts believe expectations over DMart's accelerated store expansion is largely built into near-term estimates. At the same time, Morgan Stanley maintained its 'overwieght' stance on DMart with a target price of Rs 5,188, despite the slight miss in terms of margins.

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Brokerages bullish on DMart post Q4 beat

Citi added that DMart's pofitability remains at risk due to competitive intensity from other large format stores and quick commerce players. The brokerage seeks better entry point and valuation as the risk-reward seems unfavourable. Morgan Stanley highlighted that the business has not seen any supply chain disruptions so far. DMart's management noted a spike in consumer purchases in March driven by geopolitical tensions, which normalized toward the end of the month.

''We believe gross margin expansion was led by mix improvement and slight ease of discounting by ecom/ quick comm competitors in 4Q whereas EBITDA margin expansion was led by operating leverage and cost discipline,'' said Systematix Institutional Equities. ''We expect the company to open 50/ 51 stores in FY27E/ FY28E respectively with a 3.2% CAGR in revenue per sq.ft during FY26-FY28E and margins of 7.6%/7.8% during FY27/FY28E respectively. We have build in revenue/ EBITDA/ PAT CAGR of 15.3%/ 17.2%/ 21.4% respectively over FY26-FY28E,'' added the brokerage on DMart.

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DMart Q4 Results

DMart's Ebitda margin improved to 6.84% in the March quarter of FY26 from 6.42% in the same period last year, reflecting better operating performance. The company said it had 500 stores as of March 31, 2026, including one store at Sanpada in Navi Mumbai that remains closed for reconstruction. Revenue per sq. ft. grew by 1.8% YoY to Rs 35,382 (annualised) for Q4 FY26, however, it was down 1.4% YoY for FY26. Bills cut per store contracted by 4.5% while average bill size grew by +2.8% YoY.

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