V-Mart's revenue grew 16.7% YoY to Rs 7.8 billion led by +19%YoY growth in V-Mart (84% of revenue) and +11% growth in Unlimited (15% revenue) while Limeroad revenue declined 35% (1% revenue). The strong doubledigit growth was led by volumes. Same store sales growth stood at 8% (7% for V-Mart, 10% for Unlimited) led by 11% rise in footfalls.
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Systematix Report
Management maintained a positive outlook on demand going ahead, however, the rise in competitive intensity shall be a major concern with competition being agile in store openings where V-Mart Retail Ltd. is already present or is likely to expand. The company shall continue to provide value to customers, which is likely to keep ASP lower, in our view.
In Limeroad, breakeven is not expected in FY26; however, losses are projected to decline steadily. Store expansion shall remain steady with minimum store closures. We estimate store addition of 50 stores in FY26E and 52 stores in FY27E.
We have cut our revenue estimates by 0.5%/2% for FY26E/FY27E respectively. We have marginally trimmed our operating margins by 20- 30 bps for FY26/FY27E and anticipate operating margins of 12.1%/12.7% in FY26E/FY27E respectively.
We have built in revenue/ Ebitda CAGR of 15.8%/ 21.3% respectively over FY25-27E.
We maintain our Hold rating with revised target price of Rs 3,588 (vs Rs 3,970 earlier) based on an EV/Ebitda multiple of 13x Mar 2027.
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