Avenue Supermarts Limited: Q1F27 revenue growth (+15%) disappoints

研报英文原文证据摘录

Avenue Supermarts Limited: Q1F27 revenue growth (+15%) disappoints

Latika Chopra, CFA AC Asia Pacific Equity Research

(91-22) 6157-3584 02 July 2026 J P M O R G A N

latika.chopra@jpmorgan.com

Investment Thesis, Valuation and Risks

Avenue Supermarts Limited (Neutral; Price Target: Rs4,400.00)

Investment Thesis

We view Avenue Supermarts Limited as an exciting play on the under-penetrated but fast-

growing organized retail industry (Food and Grocery) in India. We like the company’s

execution capabilities, single-format focus, sensible approach to operating stores that offer

healthy profit/return metrics, prudent store expansion strategy and strong focus on customer

satisfaction. However, the rapid proliferation of online grocery formats in metro cities is

impacting DMART’s high-turnover metro stores. This is likely to weigh on DMART’s near-

term SSSG momentum, even as the company increasingly shifts its store base towards

smaller towns. We still expect DMART to print mid-teens+ revenue/earnings growth with

its solid value position and steady store expansion pace, which should drive sustainable

market share gains over a large unorganized space. Key share price catalysts: SSSG trends,

pace of store openings, and ramp-up of DMART Ready.

Valuation

Our Mar-27 PT is Rs4,400, based on DCF, with a WACC of 10.5% and a terminal growth

rate of 6.5%.

Risks to Rating and Price Target

Upside risks to our rating and price target include: 1) lower-than-expected impact from

Quick Commerce driving better SSSG momentum; 2) a significant step-up in the store

expansion pace; 3) higher-than-expected revenue contribution from General Merchandise

& Apparel supporting margin delivery; and 4) better-than-expected revenue/profit scale-up

of the DMART Ready venture.