DMart shares fell over 4% after its Q1 FY27 results as slower same-store sales growth and rising competition from quick commerce platforms weighed on investor sentiment. While Avenue Supermarts reported double-digit growth in revenue and profit, concerns over metro market demand and DMart Ready's losses kept the stock under pressure.
Shares of Avenue Supermarts Ltd, which operates the DMart retail chain, declined sharply after the company’s June quarter results highlighted concerns over slowing growth in mature stores and rising competition from quick commerce platforms. DMart shares fell as much as 4.23% to ₹3,910 on the BSE during early trade on Monday, becoming one of the top losers across the BSE 500 and NSE 500 indices.
Despite the decline, the stock has gained around 6.2% so far in 2026. Brokerages maintained a cautious view on the stock, citing slower same-store sales growth, pressure in metro markets and a weaker medium-term growth outlook.
DMart Q1FY27 Financial Performance
Avenue Supermarts reported resilient profitability during the April-June quarter of FY27. On a consolidated basis, net profit increased 11.3% year-on-year to ₹860.6 crore compared with the previous year. Revenue from operations rose 15% YoY to ₹18,794.5 crore.
Standalone performance remained strong, with net profit rising 12.8% YoY to ₹935.8 crore. Standalone revenue from operations increased 15.1% to ₹18,343.5 crore from ₹15,932.1 crore in Q1FY26. On a sequential basis, standalone revenue grew 6% from ₹17,204.5 crore reported in Q4FY26.
At the operating level, EBITDA increased 15.4% YoY to ₹1,499 crore, while EBITDA margin remained stable at 7.97% compared with 7.94% in the year-ago period. Better gross margins helped the company maintain profitability despite slowing growth momentum.
Same-Store Growth Slows Amid Metro Market Pressure
The major concern for investors was the slowdown in like-for-like (LFL) growth, which reflects sales growth from stores operating for more than two years. LFL growth declined to 5.5% in Q1FY27 from 10.8% in Q4FY26 and 7.1% in Q1FY26.
DMart CEO and Managing Director Anshul Asawa said stores older than two years grew 5.5% during the quarter. However, growth in older stores located in large metro cities, which contribute significantly higher revenue per square foot, remained flat. In contrast, stores in non-metro markets continued to perform well.
Revenue from sales per square foot declined 2.37% YoY to ₹8,571 in Q1FY27, indicating pressure on store productivity.
Quick Commerce Competition Impacts Growth Outlook
Increasing competition from quick commerce companies as a key challenge for DMart, especially in urban and metro markets. Companies offering faster grocery deliveries have created pressure on DMart’s core food category, which remains its largest revenue contributor.
The food category’s revenue share declined to 54.93% in Q1FY27 from 55.60% in Q1FY26. The category includes staples, groceries, dairy products, processed foods, fruits and vegetables, which face strong competition from online grocery platforms.
The share of non-food consumer goods, including personal care, toiletries and home care products, remained stable at 19.60%. General merchandise and apparel contribution increased to 25.47% from 24.73% a year ago.
DMart Expansion and DMart Ready Performance
DMart added three new stores during the quarter, taking its total store count to 503 as of June 30, 2026. The company continues to follow a cluster-based expansion strategy.
However, its e-commerce arm Avenue E-Commerce Ltd, which operates DMart Ready, reported a comprehensive loss of ₹91.39 crore for Q1FY27. The company discontinued operations in seven cities with limited contribution and currently operates DMart Ready in 11 cities.
