DMart Share Price Falls 4% After Q2 Results: Profit Rises Just 8% Despite 18% Revenue Growth; Should Investors

Shares of Avenue Supermarts, the company that operates the popular retail chain DMart, slipped 4% after the company announced its September quarter results for FY27. While DMart reported nearly 18% growth in revenue, its net profit increased by just 8.49%, which has raised some concerns over rising expenses and shrinking profit margins.

At the same time, many global brokerages, including JPMorgan, Jefferies, Morgan Stanley and UBS, reduced their target prices for Avenue Supermarts stock.

DMart Q2 Results FY27

According to the company's financial results for the quarter ended September 30, 2026, DMart's consolidated revenue from operations increased nearly 18% YoY to Rs. 19,644.01 crore, compared with Rs. 16,676.30 crore in the same quarter last year.

However, consolidated net profit rose only 8.49% to Rs. 742.98 crore from Rs. 684.85 crore in Q2 FY26. Meanwhile, profit before tax increased 8.47% to Rs. 1,024.84 crore.

On a standalone basis, Avenue Supermarts reported a net profit of Rs. 803.60 crore, compared with Rs. 746.55 crore in the corresponding quarter last year, registering a growth of 7.64%.

Investors generally expect a company's profit to grow alongside its revenue. However, DMart's profit growth is lagging majorly behind sales growth.

Earlier, on October 3, Avenue Supermarts had released its Q2 FY27 business update, reporting standalone revenue from operations of Rs. 19,206.18 crore.

This represented an 18.4% increase compared with Rs. 16,218.79 crore in the September quarter of the previous financial year.

The company's revenue also increased 4.7% on a quarter-on-quarter basis from Rs. 18,343.49 crore in Q1 FY27. DMart's September quarter revenue growth was stronger than the 15.1% YoY growth reported in the June quarter.

DMart Store Expansion

Despite concerns over profitability, DMart continued expanding its retail presence across India. The company opened 15 new stores during the September quarter, taking its total store count to 518.

Another positive development was the improvement in revenue growth from existing stores. Revenue growth from stores operational for at least 24 months increased to 9.5%, compared with 6.8% in Q2 FY26.

This is an important indicator because it shows that DMart's older stores are generating higher sales rather than the company depending entirely on new store openings for revenue growth.

DMart Share Price Target

After the announcement of DMart's Q2 FY27 results, several global brokerages revised their target prices for Avenue Supermarts shares.

JPMorgan lowered its DMart share price target to Rs. 3,925 from Rs. 4,100 while maintaining a neutral rating.

Jefferies also reduced its target price to Rs. 4,000 from Rs. 4,500 and retained its hold recommendation.

Meanwhile, UBS maintained its buy rating on Avenue Supermarts but lowered its target price to Rs. 4,500 from Rs. 5,000.
Citi was cautious, maintaining a sell rating and reducing its target to Rs. 3,250.

However, CLSA continued to remain bullish on DMart shares, maintaining its buy rating with an unchanged target price of Rs. 5,723.

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