Synopsis:
UBS maintained a “Buy” on Avenue Supermarts, raising its target to ₹5,600, with a bull case of ₹6,600, citing strong store expansion and DMart Ready growth.
This Large-cap stock, engaged in operating and managing retail stores under the DMart brand, offering groceries, apparel, home essentials, and consumer products to value-conscious customers across India, jumped 2 percent after UBS gave a bull case target of Rs. 6,600, which has an upside potential of 39.99 percent.
With a market capitalization of Rs. 309,758.70 crores, the share of Avenue Supermarts Limited has reached an intraday high of Rs. 4,815.90 per equity share, rising nearly 2.11 percent from its previous day’s close price of Rs. 4,716.55. Since then, the stock has retreated and closed at Rs. 4760.15 per equity share.
What is the News?
UBS, a prominent brokerage firm, has recommended a “Buy” call on Avenue Supermarts Limited with a target price of Rs. 5,600 per share, which is increased from Rs. 5,050 per equity share, indicating an upside potential of 18.73 percent from its previous day’s close price of Rs. 4,716.55.
Additionally, the UBS has also recommended a bull case that sets a price target of Rs. 6,600 for Avenue Supermarts, assuming 22 percent revenue growth driven by quicker store expansion and DMart Ready growth. This target indicates a possible upside potential of 39.93 percent from its Wednesday’s closing price.
Rationale for Target
UBS sees strong growth potential in Avenue Supermarts (DMart), mainly because of its expansion plans. After adding about 130 stores in the past three years, the company is now expected to accelerate and open nearly 230–250 stores over the next three years. This aggressive rollout could drive faster business growth.
The second reason is DMart’s growing focus on its e-commerce arm, DMart Ready. By improving its value offerings and combining online convenience with offline reach, DMart is expected to strengthen its market position further.
UBS also highlights DMart’s steady Same Store Sales Growth (SSSG). With sales growth in high single digits last year, the company has shown that quick-commerce platforms are not a major threat, as DMart remains the go-to option for value-focused middle-income consumers.
Lastly, DMart is seen as a key player in India’s $60 billion organized grocery retail market, where penetration remains low. UBS believes this will allow DMart to sustain long-term structural growth of 18-22 percent, supporting its high valuation and future upside.
Company Overview
Avenue Supermarts Limited, popularly known as DMart, is an Indian retail corporation operating a chain of supermarkets and hypermarkets. Founded by Radhakishan Damani and headquartered in Mumbai, the company was incorporated in 2000, but the first store opened in 2002.
As of 2025, DMart operates 415 stores across 12 states and union territories in India, offering a wide range of products, including groceries, apparel, household items, and more, with a mission to provide good products at great value.
Store Capacity
Avenue Supermarts Limited, which operates DMart, has built a strong presence with 415 stores across India. Its largest base is in Maharashtra with 116 stores, followed by Gujarat (66), Telangana (45), Andhra Pradesh (41), Karnataka (40), Tamil Nadu (26), Rajasthan (22), Punjab (19), Madhya Pradesh (24), NCR (9), Chhattisgarh (6), and Daman (1), serving a wide customer base nationwide.
Recent quarter results
Coming into financial highlights, Avenue Supermarts Limited’s revenue has increased from Rs. 14,069 crore in Q1 FY25 to Rs. 16,360 crore in Q1 FY26, which has grown by 16.28 percent. The net profit has slightly decreased by 0.13 percent from Rs. 774 crore in Q1 FY25 to Rs. 773 crore in Q1 FY26.
Avenue Supermarts Limited’s revenue and net profit have grown at a CAGR of 19 percent and 15.78 percent, respectively, over the last five years.
In terms of return ratios, the company’s ROCE and ROE stand at 18 percent and 13.4 percent, respectively. Avenue Supermarts Limited has an earnings per share (EPS) of Rs. 41.61, and its debt-to-equity ratio is 0.04x.
Written By – Nikhil Naik
Disclaimer
The views and investment tips expressed by investment experts/broking houses/rating agencies on tradebrains.in are their own, and not that of the website or its management. Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution while investing or trading in stocks. Trade Brains Technologies Private Limited or the author are not liable for any losses caused as a result of the decision based on this article. Please consult your investment advisor before investing.
