#PAT #MARGIN

In FY24, the PAT margin was negative 4% because of exceptional loss. In FY25, the PAT margin stood at 12.9%. Excluding the exceptional losses, the PAT margin stood at 13.3% (v/s ~13.6% in FY24).

#ROCE

In FY25, the return on capital employed improved to ~19.2%. In FY24, the return on capital employed declined to 3.3%. The ratio was lower due to exceptional loss during the year pertaining to impairment loss towards brand and goodwill for Africa and related to loss on sale of subsidiaries and business in East Africa pursuant to changes in business model and long term strategy for Africa. Excluding exceptional loss, the return on capital employed in FY24 stood at ~22.5%.

#ROE

In FY25, the return on equity improved to ~15.1%. In FY24, excluding the exceptional loss, the ROE stood at ~14.5%.

#COMPANY #POTENTIAL

• Personal wash: The Indian personal wash market is highly competitive. Many companies are present in the Indian market. The consumption of bath bar soaps is high, whereas it is very low for body wash and shower gel products as it is still a new category for many consumers. Innovative variants and product development has driven the personal wash market in the past few years and will continue to expand the categories by introducing newer products. • Hair Care: The Indian hair care market is forecasted to reach USD 4.89 billion by 2025 growing at a CAGR of 6.58% during the period (2020-2025). The hair care market in India offers products such as a colourant, hair spray, conditioner, styling gel, hair oil, shampoo, and other products. • The changing consumer dynamics coupled with increasing product awareness has been identified as the major driver of the market. These changes are majorly due to the high millennial population migration towards cities and rising women employment. Household-insecticide: In Indian household market insecticide, mosquito repellent category is dominant over cockroach & rat repellent category, simply because of the large population based in rural India. Again, in the mosquito repellent category, there are two segments namely in-home segment and personal & outdoor segment. In-home segment has been growing in the country from last many years, but personal & outdoor segment is still at a nascent stage with products like creams, lotions, patches, gels, etc. Rise in vector borne diseases and awareness will Increase the demand of household Insecticide products in India.

#COMPANY #OUTLOOK

• In FY26, the management targets high-single digit consolidated revenue growth (driven by mid-high single digit standalone volume growth) and double-digit EBITDA growth. • The management aims to achieve double-digit growth in the medium to long term (largely volume-led growth). It targets a consistent rise in operating profit margin through premiumization and operating efficiencies in the medium to long run (especially in the international business). • The company is focusing on category development, innovation-led premiumization, market share gains, improving volume growth across categories and geographies and cost efficiencies in media and supply chain. • The company commenced operations at two of its newly inaugurated factories - Chengalpattu in Tamil Naduand and Malanpur in Madhya Pradesh. • The management anticipates efficiency in sourcing and higher productivity due to newly opened factories and savings in A&P spends to help combat the impact of palm inflation in H1 FY26. • It expects international margins to keep improving sequentially, albeit at a slower pace. • The management expects Household Insecticides (HI) and deodorants can perform much better in FY26 as compared to FY25. Further, it expects growth and margins in H2 FY26 to be better than H1 FY26. • For Park Avenue and Kamasutra, the company aspired to achieve double-digit volume growth and EBITDA margins in line with standalone margin. • The company spent over ₹100 cr on rural van operations in FY25. This helped improve their village/rural outlet reach. Management believes that rural van operations could break-even in FY26 and be accretive from FY27.
It has witnessed a spike in its sales through e-commerce channels and going ahead it expects online sales to contribute around 10% to its total sales in the next 2-3 years. • In Q3 FY24, the company launched Godrej Fab liquid detergent in select markets of South India at a price of ₹99 per litre. It will scale up gradually in the other markets. It also launched Goodknight Agarbatti. It is India's only government registered active based anti-mosquito Agarbatti. Goodknight Agarbatti uses a new molecule, Renofluthrin (RNF), which is close to 2x more effective than most other molecules used in India. The company enjoys exclusivity to use this molecule in the medium term. The market size of Anti-mosquito incense sticks is ~₹1,200 cr. • Goodknight Agarbatti crossed ₹100 cr in sales in 15 months of launch and Goodknight LV (Liquid Vapourizer) gained ~200 bps market share in Q4 FY25. • The company plans to enter the pet care business in India through Godrej Pet Care (GPC), a subsidiary of Godrej consumer products Limited (GCPL). The pet care is a ~₹5,000 cr category, with a potential of strong double-digit growth for the next few decades. The company will invest ₹500 cr in Godrej Pet Care over a period of 5 years. Godrej Agrovet Limited (GAVL) will be the manufacturing and research & development (R&D) partner. The company expects to commence manufacturing in the second half of FY26. It expects ~15%-25% of EBITDA margin in this business. • In April 2025, it launched ‘Godrej Ninja’, its pet care brand, in the state of Tamil Nadu.

Godrej Consumer Products 750-870
Expected level 1000
Support 670

Good morning

Dmart company details

Incorporated in 2000 by Radhakishan Damani, DMart opened its first store in Powai, Mumbai, in 2002.[6][7] In its early years, the company adopted everyday low price strategy[7] and pursued "slow expansion", growing to 29 stores across Maharashtra and Gujarat in 2010. Unlike other Indian supermarkets which typically leased 4,000 sq ft properties, DMart operated much larger stores, ranging up to 30,000 sq ft, most of which it owned.[8][9]

In 2013, DMart reported having 65 stores across Maharashtra and Gujarat, along with one store each in Hyderabad and Bangalore as it began expanding to other states. At the time, DMart became the third largest retail company by revenue, after Reliance Retail and Future Group.[10]

In October 2016, DMart had 112 stores, having expanded to Telangana, Andhra Pradesh, Karnataka, Madhya Pradesh and Chhattisgarh.[11][12] In December 2016, the company started its e-commerce venture called DMart Ready, allowing users to order groceries and household products online.

#Sales Growth

FY24, the sales grew by 18.6% YoY to ₹50,789 led by increase in bill cuts, like for like growth (two years and older stores) and store additions.

During the year, the total number of bill cuts increased by 17% YoY to 30.3 cr (v/s 25.8 cr in FY23) and like for like growth was 9.9% YoY. D-Mart added 41 stores in FY24.


The growth is expected to continue supported by new stores addition and maturing of older stores.

In FY23, the sales stood at ₹42,840 cr (v/s ₹30,976 cr in FY22), i.e., a growth of 38% YoY on account of low base (because of Covid 2nd wave impact in Q1 FY22), recovery In footfalls, higher price of products and supported by new stores addition.

During the year, the total number of bill cuts were 25.8 cr (v/s 18.1 cr in FY22) and the like for like growth was 24.2%


5 Year CAGR: 20.5%

#EBITDA #GROWTH

In FY24, the EBITDA grew by 12.8% YoY to ₹4,104 cr. The growth was partly offset by increase in contribution of lower margin foods business in the total sale mix, increase in employee expense
During the year, DMart continued to witness lower contribution from general merchandise & apparel (GM&A) business in the total sales mix.

In FY23, the EBITDA stood at ₹3,637 cr (v/s ₹2,499 cr in FY22), i.e., a growth of 46% YoY because of increase in scale of operation through store addition.

During the year, the FMCG and staples segment had performed better than the general merchandise and apparel segments. The general merchandise & apparel product category mainly impacted due to inflation.

5 Year CAGR: 20.2%

#PAT #GROWTH

In FY24, the PAT grew by 6.6% YoY to ₹2,536 cr. Excluding the one-time tax adjustment of prior years of ₹138.77 cr in FY23, the PAT grew by 13.2% YoY in FY24.

In FY23, the PAT stood at ₹2,378 cr (v/s ₹1,492 cr in FY22), i.e., a growth of 59% YoY. The growth was on account of higher operating profit and lower tax expenses.

The effective tax rate for FY23 stood at 22.3% as compared to 27.7% in FY22. The effective tax was lower during the year because of one-time net tax adjustment of prior year of ₹138.7 cr. The PAT after excluding the one-time tax adjustment in FY23 stood at ₹2,240 cr.

5 Year CAGR 23%

#EBITDA #margin

In FY24, the EBITDA margin contracted by 41 bps YoY 8.1% because of contraction in gross profit margin and increase in employee benefit expenses and other expenses as a percentage of sales. Gross profit margin contracted by 27 bps YoY to 14.8% mainly due to nigher sales contribution from lower margin foods business. The general merchandise and apparel segment stood at 22.37% (v/s 23.04% in FY23) of the total sales mix.

The company's purchase of stock in trade constitutes ~93% of the total expenses followed by other expenses ~5% and employee benefits expense ^2% of the total expenses.

In FY23, the EBITDA margin improved by 42 bps YoY to 8.5% because of improvement in gross profit margin from 14.8% to 15.1%. During the year, the company continued to witness lower consumer spending on general merchandise and apparel segment. The contribution of general merchandise and apparel stood at 23.04% (v/s 23.40% in FY22).

#PAT #MARGIN

In FY24, the PAT margin contracted by 56 bps YoY to 5% because of contraction in operating margin. Excluding the one-time tax adjustment in FY23, the PAT margin contracted by 24 bps YoY.In FY23, the PAT margin expanded by 73 bps YoY to 5.6% supported by improvement in operating profit margin and lower tax expenses.The PAT margin in F¥23 after excluding the one-time tax adjustment, stood at 5.2%, i.e., an expansion of 41 bps YoY as compared to FY22.

#ROCE

In FY24, the return on capital employed stood at ~19.6%.


#DEBT #TO #EQUITY

Avenue Supermarts Ltd.
The debt to equity ratio of the company is 0

#Management #comment


Dmart will continue to add larger format stores mainly in existing locations to get the benefit of operating levera focusing in the northern part of India, mainly in Uttar Pradesh (UP), National Capital Region, Punjab and Rajasthan for expansion. The company opens larger format stores just to accommodate more traffic for the longer term and to experiment more and more categories in the non-FMCG (fast moving consumer goods) space. It sees huge opportunity in Mumbai Metropolitan Region (MMR). It would acquire land in Virar, Vasai and Dombivli if prices are within the range that it has been looking for. It is focusing on private labels as a long term opportunity as the margins are relatively better in it. The company generally holds more inventories in private label products than in branded products. Avenue E-commerce Limited (DMart Ready) is more focused on groceries and fast moving consumer goods (FMCG) products. It had 519 pickup points of which ~300 were in Mumbai. Dburing the year, Dmart Ready commenced operations in Gurugram while continued to deepen its presence DMart is now present across 23 cities in India. The majority of revenue comes from Mumbai Metropolitan focus will be more dominant on the large towns of the country for expansion. The management does not expect DMart Ready to become a substantial revenue contributor in the short committed to the concept from a long term perspective.

Dmart 3400-3710
Expected level 4500
Support 3000