India's Shoppers Stop forecasts festive quarter to top pre-pandemic levels (updated)

Shoppers Stop

20/10/2022 11:48

(Adds forecast, CEO comment, details on sales; updates shares)
    By Praveen Paramasivam
       BENGALURU, Oct 19 (Reuters) - India's Shoppers Stop
 SHOP.NS  said on Thursday its sales for the festive season
would beat pre-pandemic levels on demand for gifts as well as
occasion and winter wear from the country's affluent, after
reporting a 60% jump in quarterly revenue.
    High-income, urban consumers have largely shrugged off the
impact of high cost of living to refresh their wardrobes and
splurge on makeup and fragrances as they venture out to social
events and offices more.
    Shoppers Stop would report sales growth in the mid- to
high-teens percentage range, compared with pre-COVID sales
growth levels, with stores in east India outperforming the rest
of the country, Chief Executive Officer Venu Nair said in an
interview with Reuters.
    "It's the first Diwali after COVID where people are able to
get out and mingle with their friends and family and that's
definitely helping," Nair said.
    Indian retailers record a bulk of their sales during the
Hindu festival period from late September to early November.
    To cash in on what is expected to be a busier-than-normal
festive season, Shoppers Stop doubled its purchase of inventory
during the second quarter, with expenses climbing 40%.
    Net income was 181.4 million rupees, versus a loss of 30.3
million rupees a year earlier, but the profit came in below the
average estimate of four analysts polled by Refinitiv.
    A jump in customer visits and an increase in customer
spending, however, drove revenue of 10.08 billion Indian rupees
($121.35 million).
    Shares in the Mumbai-based chain, which have more than
doubled this year, closed 3.4% lower at 774.80 rupees.
    "We have a positive view on the stock. The correction today
could be some booking of profits; in the past three to six
months, it has significantly outperformed the market," said
Gaurav Dua, head of capital market strategy at Sharekhan.
 
 ($1 = 83.0670 Indian rupees)
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Shoppers Stop braces for big festive shopping season    https://tmsnrt.rs/3TmlDKn
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 (Reporting by Praveen Paramasivam and Rama Venkat in Bengaluru;
Editing by Janane Venkatraman)
 ((Praveen.Paramasivam@thomsonreuters.com; https://twitter.com/PraveenR_P
 ; +91 867-525-3569;))