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Shares of Avenue Supermarts, which runs the DMart chain of stores, continued to remain under selling pressure after dismal Q1 June 2020 result. The company reported Q1 result on Saturday (11 July) after which the stock has fallen 15% in five trading days.
The stock is now below its QIP issue price of Rs 2049 per share. In February 2020, Avenue Supermarts allotted 2 crore equity shares to qualified institutional buyers at an issue price of Rs 2049 per share, aggregating to Rs 4098 crore.
The stock trades below its 200 days simple moving average placed at 2098.04. This will act as a crucial resistance in near term.
DMart's consolidated net profit slumped 85.22% to Rs 49.56 crore on 32.94% fall in total income to Rs 3,884.57 crore in Q1 June 2020 over Q1 June 2019. Consolidated EBITDA fell 81.24% to Rs 112 crore in the latest quarter, as compared to Rs. 597 crore in the corresponding quarter of last year. EBITDA margin stood at 2.9% as on 30 June 2020 as compared to 10.3% as on 30 June 2019.
Commenting on the financial performance of the company, Neville Noronha, CEO & managing director, Avenue Supermarts, said Covid-19 continued to spread across the country. The ensuing restrictions have had a significant impact on the company's operational and financial performance in the quarter.
Mumbai-based Avenue Supermarts owns and operates D-Mart stores. As of June 30, 2020 the Company had 216 stores with Retail Business Area of 8 million square feet across Maharashtra, Gujarat, Daman, Andhra Pradesh, Karnataka, Telangana, Tamil Nadu, Madhya Pradesh, Rajasthan, NCR, Chhattisgarh and Punjab.
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