PAT margin stood at 6.4% in Q2FY23 as compared to 5.3% in Q2 FY22.

EBITDA in Q2FY23 stood at Rs 892 crore, up by 33.3% from Rs 669 crore in the corresponding quarter of last year. EBITDA margin stood at 8.4 % in Q2FY23 as compared to 8.6% in Q2FY22.

Commenting on the DMart (Brick and Mortar) Business, Neville Noronha, CEO & managing director, Avenue Supermarts, said: "The FMCG and staples segment of the business has performed better than general merchandise and apparel segments. Discretionary items in the non-FMCG segment while recovering have still not come back to pre-pandemic levels. The inflationary stress is more acute at lower price points in discretionary non-FMCG categories. Average basket values continue to be elevated and footfalls continue to be lower than pre-pandemic levels.

Post wave 2 of COVID-19, January 2022 was the first month post pandemic when basket values dropped and footfalls were near pre Covid-19 levels. However, post the omicron third wave basket values again increased and footfalls reduced commensurate to that basket value. It has remained like that till the month of September 2022. Reduction of footfalls coupled with increased basket values make FMCG shopping more productive and profitable; however, it has a direct negative impact on the more profitable non-FMCG categories. As and when footfalls increase, we assume we should be inching towards our pre-pandemic contributions for apparel and general merchandise sales.

Our like-for-like growth (LFL) for all stores that are 5 years or older as of the end of September 2022 was at 6.5% annualized / 20.8% absolute (growth for quarter ended 30 September 2022 versus quarter ended 30 September 2019). Within this cohort, we are seeing lesser like-for-like growth in older stores which have significantly higher turnover per square feet than the company average and we have opened a new DMart store close to it. However, we do not see that effect in our younger stores.”

Speaking on DMart Ready, Neville Noronha added: “We continued our strategy of targeting large towns/cities for this business and commenced operations in 6 more cities (Anand, Belgaum, Bhilai, Jaipur, Raipur and Vijayawada) during the quarter. We are now present in 18 cities across India. While the expansion in 18 cities looks like a big leap, in most of the newer cities these are just experiments with capital allocations commensurate with outcomes. More than 90% of our revenues still continue to come from Mumbai (MMR), Pune, Bangalore, Hyderabad and Ahmedabad. These large towns are holding on to their COVID-19 time revenues.”

Avenue Supermarts is a Mumbai-based company, which owns and operates D-Mart stores. D-Mart is a national supermarket chain that offers customers a range of home and personal products under one roof. The company offers a wide range of products with a focus on foods, non-foods (FMCG) and general merchandise & apparel product categories. As of 30 September 2022, the company had 302 operating stores with retail business area of 12.4 million sq. ft across Maharashtra, Gujarat, Daman, Andhra Pradesh, Karnataka, Telangana, Tamil Nadu, Madhya Pradesh, Rajasthan, NCR, Chhattisgarh and Punjab.

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