Avenue Supermarts Q1 FY26: Revenue up 16%, margins slip

What DMart reported for Q1 FY26

Avenue Supermarts, the operator of the DMart retail chain, reported a steady rise in sales for the quarter ended 30 June 2025 (Q1 FY26). The update pointed to continued demand traction, but also showed pressure on profitability metrics in parts of the reported data. The company published both standalone and consolidated numbers for the period, with the consolidated results approved by the Board on 11 July 2025. In the same broader results context, the company was also flagged as having outstanding debt obligations for the first time in the last five years.

Standalone: revenue growth outpaces profit growth

On a standalone basis, revenue from operations for Q1 FY26 rose 16.2% year-on-year to ₹15,932 crore, compared with ₹13,712 crore in the same quarter last year. Standalone net profit for the quarter was ₹830 crore, up 2.1% from ₹812 crore a year earlier. Basic EPS came in at ₹12.75, up from ₹12.49 in the year-ago quarter. The set of standalone highlights also reported EBITDA of ₹1,313 crore, reflecting 7.6% year-on-year growth.

The gap between revenue growth and profit growth was a key feature of the quarter’s reported performance. While sales expanded at a mid-teens pace, profit rose at a low single-digit rate. That mix typically indicates cost pressure or margin compression, and the results commentary around the quarter referenced high costs and a competitive environment.

Consolidated: revenue rises, profit figures vary across summaries

Alongside standalone performance, the company reported unaudited consolidated financial results for the quarter ended 30 June 2025. Consolidated revenue from operations was ₹16,359.70 crore, up 16.3% year-on-year.

On profits, the provided material contains two different consolidated profit figures for Q1 FY26. One stated consolidated net profit declined 28.8% to ₹550.79 crore, compared with ₹773.68 crore in Q1 FY24. Another set of “Q1FY26 Consolidated Financial Highlights” stated net profit stood at ₹773 crore for Q1 FY26 compared with ₹774 crore in Q1 FY25, with PAT margin at 4.7% versus 5.5% a year earlier. Both numbers are presented in the supplied text, and both point to pressure on margins, either through a sharp decline in profit or a flatter profit with a lower margin.

The highlights also showed EBITDA at ₹1,299 crore in Q1 FY26 versus ₹1,221 crore in Q1 FY25, while EBITDA margin was reported at 7.9% versus 8.7%.

Competition and cost pressures in focus

The broader framing of the quarter was “more of the same amid clouds of competition and high costs.” That assessment is consistent with the pattern in the reported numbers where revenue growth remained healthy but margins eased. Even where profits appeared largely flat (as one consolidated highlight suggested), the reported margin deterioration indicates costs rose faster than sales.

The mention of outstanding debt obligations for the first time in five years also fit into the theme of tighter cash and higher operating and expansion demands. Separately, the company raised ₹100 crore in short-term debt via commercial paper, reinforcing the idea that liquidity management has become more active.

Commercial paper issuance and what it signals

Avenue Supermarts raised ₹100 crore through issuance of commercial paper (CP). The CP was issued on a Monday and was set to mature after 91 days on 29 December 2025, with a 6% coupon rate. The company said the CP was proposed to be listed on the BSE, and it carried a credit rating of ICRA A1+.

While CP is a standard treasury tool, the update was notable because it coincided with the remark that the company has outstanding debt obligations for the first time in five years. The combination places attention on funding needs alongside store additions and operating costs.

Q2 FY26: revenue up 15%, margins slightly lower

For the quarter ended 30 September 2025 (Q2 FY26), standalone revenue was reported at ₹16,218.79 crore, up 15.4% year-on-year from ₹14,050.32 crore. Another data point in the same context referenced revenue from operations at ₹16,676 crore on a consolidated basis, up 15% from ₹14,444 crore a year ago, and 2% higher sequentially compared to ₹16,360 crore in the June quarter.

The supplied metrics for Q2 FY26 also included:

• Standalone net profit: ₹746.55 crore, up 5.1% year-on-year and down 10.1% quarter-on-quarter.
• Consolidated net profit: ₹684.85 crore, up 3.9% year-on-year and down 11.4% quarter-on-quarter.
• Store count: 432 stores as of 30 September 2025, after adding eight new stores during the quarter.

The company’s CEO-designate, Anshul Asawa, was cited as saying DMart passed on the benefit of reduced GST rates to customers following the government’s reforms.

Q3 FY26: revenue rises and store network expands

For the quarter ended 31 December 2025 (Q3 FY26), Avenue Supermarts reported a 13.15% jump in standalone revenue from operations to ₹17,612.62 crore compared with ₹15,565.23 crore in Q3 FY25. The total number of stores as of Q3 FY26 stood at 442, including one store at Sanpada, Navi Mumbai, Maharashtra that was closed for customers due to reconstruction.

The board of directors was scheduled to meet on Saturday, 10 January 2026, to consider and approve the unaudited financial results for the quarter and nine months ended 31 December 2025.

Key numbers at a glance

Market impact and stock context

The share price was cited at ₹4,286.90 as of 19 June 2026 (03:59 PM IST). Another snapshot showed the stock at ₹4,328.60 as of 1 July 2026, versus a previous close of ₹4,380.70. The supplied text also said the stock was up 21.54% since the beginning of the year.

The market discussion around the results cycle repeatedly focused on the same themes: strong sales growth, but modest profit growth and margin pressure despite store additions. That framing matters because valuation in large-format retail often hinges on the ability to defend margins while scaling store count.

Analysis: why the quarter matters

Q1 FY26 reinforced that DMart’s growth engine remains intact on revenue, with both standalone and consolidated sales rising around 16% year-on-year. But the profit and margin signals were less clean, including lower consolidated margins and a mismatch between revenue and profit growth on the standalone line. The commercial paper issuance and the mention of debt obligations, when viewed alongside capex and expansion, add another layer for investors tracking funding discipline.

The Q2 and Q3 updates also help establish that demand stayed steady through FY26, with revenue continuing to rise and the store base expanding from 432 to 442 by Q3 FY26. Still, the repeated reference to competition and high costs indicates that the market will continue to monitor margin movement as closely as headline sales growth.

Conclusion

Avenue Supermarts’ Q1 FY26 showed healthy revenue growth, while profitability and margins faced pressure in parts of the reported data. Subsequent quarters kept revenue momentum intact and store additions continued, even as short-term borrowing via commercial paper appeared in disclosures. The next confirmed milestone in the provided timeline was the board meeting scheduled for 10 January 2026 to approve Q3 FY26 results.