DMart Q3 results preview: Quick commerce competition to weigh on profit? Check target

Radhakishan Damani-backed Avenue Supermarts, the operator of the hypermarket chain DMart, is set to report numbers for the quarter ended December 2025 on Saturday, January 10, supported by steady store additions. On Friday, shares of DMart closed 0.43 per cent higher at Rs 3805.10 against its previous close of Rs 3788.90 apiece.

In a preliminary business update filed with the exchanges earlier this month, the retail major reported that its standalone revenue from operations for the quarter stood at Rs 17,612.62 crore. This represents a growth of approximately 13.2 per cent compared to Rs 15,565.23 crore reported in the corresponding quarter of the previous fiscal year.

The company also continued its expansion drive, ending the quarter with a total store count of 442, having added net new stores during the period.

During the quarter, DMart opened new stores in Chirala (Andhra Pradesh), Hassan (Karnataka), Halol (Gujarat), Baran (Rajasthan), Chittoor (Andhra Pradesh), Bhiwadi (Rajasthan), YSR Kadapa (Andhra Pradesh), Kovilpatti (Tamil Nadu), and Madhapar (Gujarat).

Estimates

Brokerage firm Motilal Oswal Financial Services (MOFSL) has maintained a ‘Buy’ rating on the stock with a target price of Rs 4,300, implying a potential upside of 13 per cent.

While the top-line growth appears healthy, MOFSL expects the bottom line to remain muted. The brokerage anticipates consolidated revenue to grow roughly 13 per cent year-on-year (YoY), largely driven by a 14 per cent growth in store additions. However, they project profit after tax (PAT) growth to be modest at 5 per cent YoY, MOFSL said.

The primary concern for MOFSL lies in operational efficiency. They expect the EBITDA margin to contract by approximately 35 basis points YoY to 7.3 per cent, attributed to the continued higher cost of retailing and lower GM.

Meanwhile, Axis Direct forecasts that the retailer will post a mixed performance. The brokerage expects DMart to benefit from improving demand in smaller towns and the early onset of the festive season. They estimate revenue to grow around 15.5 per cent YoY.

However, on the operational front, Axis Direct expects EBITDA margins may decline to 7.2 per cent, weighed down by higher opex led by store expansion and weak GM. They project the company’s PAT to come in at Rs 707 crore, marking a 7.3 per cent increase over the previous year. The brokerage has identified DMart as one of their ‘Top Positive Plays’ in the retail sector.

Systematix Institutional Equities has assigned a ‘Hold’ rating on the stock with a target price of Rs 4,055. Their preview note highlights that while DMart is expected to report 13.2 per cent revenue growth, the performance is likely being impacted by intensifying competition from quick commerce players.

The brokerage also pointed to deflationary trends in select categories and the dilution and cannibalisation effects from rapid store expansion as headwinds facing the retailer. Systematix estimates an EBITDA margin of 7.6 per cent, a contraction of 34 basis points YoY, and expects PAT to grow by 4.4 per cent to Rs 819.6 crore.