India's Avenue Supermarts' store addition guidance weak - Jefferies

Avenue Supermarts

27/07/2023 08:34

** Jefferies says Avenue Supermarts'  AVEU.NS  40-store
addition guidance for FY24 weak in context of rising base
    ** Shares of DMart store operator down 0.53% at 3,693 rupees
    ** Adds general merchandise and apparel (G&MA) revenues have
remained soft recently on inflation, lower footfalls and
increased competition, but expects recovery
    ** As stores mature, G&MA revenue share typically declines
on more intent-driven and fewer impulse purchases - Jefferies
    ** Flags upside catalysts from expansion potential, store
density increase and consolidation; maintains "hold" with PT of
3,700 rupees
        ** AVEU posted near-2.5% climb in Q1 net profit on July
15 
  
    ** Mean recommendation of 25 analysts is "hold"; median PT
3,786.00 rupees - Refinitiv data
    ** YTD, stock has fallen ~9%

 (Reporting by Hritam Mukherjee in Bengaluru)
 ((Hritam.Mukherjee@thomsonreuters.com;))