DMart Shares Drop 3% After Missed Q3 Earnings Estimates; Major Leadership Shuffle Announced

Shares of DMart fell by up to 3% this morning after the company missed Q3 earnings estimates. The stock slipped to an intraday low of Rs. 3,469 after opening at Rs. 3,501. Dmart's share movement aligned with the broader market decline, but individually, the company's shares have been on a downside over the last five trading sessions.

D'Mart Q3 Results

Avenue Supermarts, the parent company of DMart, released its earnings report on January 11th for the third quarter of FY25. The company's total revenue for the quarter stood at Rs. 15,565 Crore, with a year-on-year (y-o-y) growth of 17.5%. Profit After Tax (PAT) or net profit increased by 6.5% as compared to the same quarter last year, totaling Rs. 785 Crore.The EBITDA for Q3 FY25 reached Rs. 1,235 Crore, up by 10.2% from the same period last year.

Similarly, The Basic Earnings Per Share (EPS) for the quarter was Rs. 12.06, up from Rs. 11.32 in Q3 FY24, with improved profitability on a per-share basis.

Additionally, DMart continued to expand its footprint by adding 10 new stores during the December quarter and 22 stores during the first nine months of FY25.

New Leadership Appointments Announced

The company has announced several key leadership changes, including the appointment of Mr. Anshul Asawa as Chief Executive Officer Designate and Senior Managerial Personnel, effective 15th March 2025. Mr. Ignatius Navil Noronha, the current Managing Director, will complete his 5-year term on 31st January 2026, after which Mr. Asawa will succeed him as Managing Director & CEO.

Additionally, the company has made the following appointments effective fron Jan 11

• Mr. Hitesh Shah has been appointed as the Head of Pharma Business to oversee the pharmacy division.
• Mr. Rajeev Chandrasekharan will take on the role of Head-Centre of Excellence, overseeing the process audit function.
• Mr. Ashutosh Dhar will transition to the role of Head-Loss Prevention

DMart Share Movement

As of January 13th, DMart shares were trading in the negative territory, down by 1.92% at Rs. 3,615 around noon. The stock has been under bearish pressure for a considerable period, with a sharp decline of 8.23% in the past five days. Additionally, it has fallen by 1.16% so far this month and has experienced a significant drop of 27% over the last six months.

Despite these short-term setbacks, the stock has shown impressive long-term performance. Over the past five years, DMart shares have delivered an 81% return to investors. Moreover, since its listing on the BSE in 2017, early investors have seen substantial returns, with 485% profit on their investments, marking the stock as a strong performer over the long term.

Expert Insight On DMart Shares

As per a report from the Nuvama Institutional equities which stated that "DMart posted strong growth in Q3FY25 driven by enhanced LTL growth. It seems to have deployed increasing discounts across segments (lower QoQ in FMCG) to protect bill size and growing footfall/store despite rising competition from quick commerce. DMart Ready has also stepped up its game in its home delivery execution. "

Experts from the research team of Nuvama Institutional equities said, "We believe DMart's margins would continue to be under pressure amid the high competition and management's focus on market share followed by margins. We are trimming revenue/PAT estimates for FY25 and FY26 by 0.5%/11% and 2.1%/17.4%, respectively, on account of lower margins and roll forward to 9mFY27, yielding a revised TP of INR4,212 (earlier INR5,040); maintain 'HOLD'."

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