- Shares of Avenue Supermarts rose 7% to Rs 4,234 on positive technical cues
- DMart added 58 stores in Q4, exceeding the consensus estimate of 51 stores
- Analysts expect a new cycle of earnings upgrades due to strong store additions
Shares of DMart parent Avenue Supermarts Ltd. surged 7% to Rs 4,234 on Wednesday following favourable technical cues, with analysts confident about the counter reaching the Rs 4,500 mark in the near term.
The retail rally was bolstered by strong performance from Avenue Supermarts (DMart), which added 58 stores in the fourth quarter—significantly ahead of the consensus estimate of 51. Analysts suggest this "beat" may drive a new cycle of earnings upgrades for the supermarket chain as it intensifies its focus on the North Indian market.
Technically, the price action suggests the bulls are back in control. Chandan Taparia, Head- Technical & Derivatives Research at MOFSL, observed that the stock has delivered a range breakout on the daily chart, supported by a significant surge in trading volumes.
The stock is currently holding well above its crucial 200-day exponential moving average (DEMA), with the Relative Strength Index (RSI) showing positive momentum.
"DMart has given a breakout from its consolidation phase today and has even surpassed its 200 DEMA. The near-term trend looks positive with support placed around Rs. 4000. The stock has potential to rally towards Rs. 4500 in the near term," said Ruchit Jain, Vice President, Equity Technical Research, Wealth Management, Motilal Oswal.
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