Avenue Supermarts Stock Snaps Five-Day Losing Streak As Q2 Revenue Jumps
Shares of Avenue Supermarts Ltd. snapped their five-session losing streak after the operator of DMart supermarket chain saw its revenue in the second quarter jump over the pre-pandemic level as business activities picked up on easing curbs to prevent a deadlier second wave.
The company, owned by billionaire Radhakishan Damani, saw its revenue from operations rise 57% and 28.6% over the corresponding period in FY19 and FY20, respectively, in the three months ended September 2021, according to its business update released on the bourses. The revenue also rose 52% over the April-June 2021 period.
Avenue Supermarts, according to the exchange filing, also added eight new stores during the reported quarter, taking its total count to 246.
The numbers, Macquarie said, points to a sharp recovery in demand. That prompted the research house to upgrade its earnings per share estimates for Avenue Supermarts by 3% for FY22 and 1% each for FY23 and FY24. Macquarie maintained its ‘outperform’ rating on the stock with a target price of Rs 4,950 apiece.
Shares of Avenue Supermarts rose as much as 5% intraday to Rs 4,465.75 apiece on the BSE but pared most gains to trade 0.72% higher as of 1.14 p.m. on Monday. The stock has rallied 49.46% in the last six months, leading to a market capitalisation of Rs 2.76 lakh crore for the company.
Of the 30 analysts tracking the company, nine each have a ‘buy’ and ‘hold’ rating, while 12 suggest a ‘sell’, according to Bloomberg data. The 12-month consensus price target implies a downside of 24%.