JP Morgan
JP Morgan described the efficiency as “a tad underwhelming,” noting the reported progress fell in need of its expectation of round 17%. Whereas DMart added 9 shops throughout the quarter, in comparison with six in the identical interval final 12 months, solely two had been in metro areas, reinforcing the corporate’s pivot in the direction of non-urban markets. “Income per retailer rose 2% y/y,” JP Morgan mentioned, including that the corporate has maintained aggressive pricing versus on-line grocers.
Citing considerations across the impression of fast commerce gamers on high-turnover city shops, JP Morgan maintained a ‘impartial’ ranking and set a value goal of Rs 4,150, implying a 5.5% draw back from the inventory’s present ranges. “A few of the current outperformance may reverse,” the brokerage cautioned, pointing to the inventory’s 9% acquire over the previous month.
Goldman Sachs
Goldman Sachs maintained a bearish stance, noting that the Q1 gross sales progress, although regular, was weaker than anticipated even on a sequential foundation. “Standalone gross sales progress in 1QFY26 moderated barely to 16.2% YoY regardless of 4QFY25 being adversely impacted by one much less day,” the brokerage mentioned, including that quarter-on-quarter progress of 10.2% was additionally softer than the prior-year interval.
Goldman expects consolidated EBITDA margins to say no year-on-year, citing “a combination shift in the direction of low-margin meals merchandise and value will increase from the sooner tempo of recent retailer additions.” The brokerage flagged heightened aggressive stress in city markets, notably from fast commerce operators and a possible pick-up in Reliance Retail’s enlargement exercise. Goldman retained its ‘promote’ ranking and a goal value of Rs 3,400, implying a 22.6% draw back.
Morgan Stanley
Morgan Stanley termed the quarter a “miss,” estimating same-store gross sales progress at round 3-4%. It expects Q1 EBITDA margins to compress to 7.8%, down from 8.7% within the year-ago quarter. Whereas retailer additions — 9 within the quarter — had been according to expectations, the brokerage flagged continued stress on like-for-like progress and profitability amid intensifying on-line competitors.The brokerage maintained its cautious outlook, making use of a residual revenue mannequin that assigns a better chance to its bear-case situation as a result of dangers posed by e-commerce and fast commerce platforms.
Market response and technical setup
Regardless of a robust begin to 2025 with positive aspects of 23%, Avenue Supermarts shares stay down 8% over the previous 12 months. The inventory fell as a lot as 3.9% intraday on Thursday to Rs 4,220 on the BSE, as traders reacted to the cautious brokerage commentary.
Consensus amongst analysts stays tepid. Information from Trendlyne exhibits the common goal value from 30 analysts at Rs 4,033, implying a possible draw back of roughly 8%. The inventory carries a consensus ‘maintain’ ranking.
From a technical perspective, DMart shares proceed to commerce above seven of their eight key easy shifting averages (SMAs), together with the 10-day, 20-day, 30-day, 50-day, 100-day, 150-day and 200-day ranges, however have slipped under the 5-day SMA, suggesting a possible pause in momentum.
Additionally learn | Avenue Supermarts shares in focus after Q1 FY26 income rises 16% YoY; retailer rely hits 424
Momentum indicators are nonetheless in bullish territory. The Relative Energy Index (RSI) stands at 63.2, comfortably under the overbought threshold of 70. In the meantime, the Shifting Common Convergence Divergence (MACD) stays optimistic at 76.3, above each its sign and middle traces, reinforcing the prevailing upward pattern.
(Disclaimer: Suggestions, strategies, views and opinions given by the consultants are their very own. These don’t characterize the views of the Financial Instances)
