Avenue Supermarts Ltd, the owner of the DMart chain of retail stores, on Wednesday crossed the ₹2 trillion market valuation after the stock surged nearly 20% in the last three weeks. The stock has gained in 11 out of the last 13 sessions, tracking gains in the broader market. In intraday trading, the stock was trading at a record high of ₹3,094.95 on BSE, up 3% with a market cap of ₹2.01 trillion. However, closed at ₹2,906.05, down 3% from the previous close. Since 17 December, DMart climbed 20%, adding nearly ₹35,000 crore to its market value. Domestic equities rose in 21 out of the 23 sessions having gained nearly 8.52%.
DMart continues to offer the highest discount across most of the categories, in turn gaining loyalty, a key factor for driving footfall. The firm targets lower-middle, middle, and aspiring upper-middle-income consumers for whom value for money plays an important role.The firm faces the risk of greater competition from JioMart, Flipkart and Amazon, but brokerage firm Axis Securities believes that the firm is well placed in the domestic retail industry given its strong execution capabilities, disciplined low prices and low costs strategy, lower cost of operation, and a streamlined distribution network, which help DMart to penetrate newer markets.
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