Target: ₹5,270
CMP: ₹4,056.05
D-Mart has consistently delivered 17-20 per cent CAGR revenue growth over the past several quarters, driven by 14-15 per cent expansion in its network and retail space. The recent investment in D-Mart Ready, to support operations, working capital and expansion, will strengthen the company’s position in the competitive online grocery market and is expected to yield long-term benefits.
In Q4FY26, D-Mart reported 9 per cent year-on-year revenue growth, driven by increased footfall. Further, Mature stores (two years and older) delivered growth of 10.8 per cent during the quarter.
Looking ahead to FY27, D-Mart’s strategic emphasis on improving store productivity, enhancing profitability and accelerating recovery in the General Merchandise and Apparel (GM&A) segment positions the company well for a gradual earnings recovery. The management noted that following the recent GST reforms, the company has passed on the benefits of rate reductions to customers, wherever applicable. With consumer demand improving, macroeconomic conditions stabilising, recent announcements on GST 2.0 reforms and a gradual demand recovery, these initiatives are well-aligned to support recovery and drive growth in high-margin GM&A categories. We remain positive on the stock’s long-term prospects and recommend ‘Buy on Dips.’
Key risks include a prolonged recovery in consumer demand and heightened competitive intensity in the value retail segment.