Avenue Supermarts Q1 Review - Second Wave Casts Shadow On Profitability: IDBI Capital
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IDBI Capital Report
Avenue Supermarts Ltd.'s Q1 FY22 results were below expectations due to lower than expected gross margin.
Revenue growth remains healthy at 31% year-on-year driven by less stringent restrictions on personal mobility during second wave compared to the first wave of Covid-19.
However, during second wave restriction on number of hours stores were allowed to operate was more severe than last time.
Gross margin at 12.4%, is lowest ever as the company was not allowed to sell margin accretive general merchandise and apparels during the lockdown period.
Positively, e-commerce business has picked up significantly during the crisis and now contributes ~3% to consolidated revenue.
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