Shoppers Stop Reported Revenue of Rs.60.7 Crs and EBITDA Loss of Rs. 132.8 Crs in Q1FY21

Shoppers Stop Ltd. (NSE: SHOPERSTOP | BSE: 532638) reported Sales of Rs.60.7 Crs and EBITDA Loss of Rs.132.8 Crs in the quarter (Non-GAAP). GAAP adjusted; the turnover is Rs.53.9 Crs and EBITDA (before exceptional item) of Rs. 1.6 Crs.

Q1 performance was significantly impacted by continued lockdowns due to the COVID pandemic. On an overall basis, we had a near complete closure in April 20, May 20 and part of June 2020. From a geographical perspective, the metros have been the most impacted and from the Region perspective Western and Northern regions were more impacted than South and East. As a result of periodic restrictions, our stores could operate barely for 17.6% during the 1st quarter. The company was therefore unable to operate normal business activities, with consequential impact on its financial performance.

The recovery has started, albeit at a very slow pace from July 2020. Maharashtra and Tamil Nadu continue to remain shut in July. We expect the near term impact continue to be negative and largely depends on factors such as overall improvement in Covid situation, opening of malls, customer confidence, etc.

Overall Performance

Commenting on the quarterly performance of the company, Mr. B S Nagesh, Customer Care Associate, Non-Executive Chairman, Shoppers Stop Ltd. said, "This quarter was challenging on the business operations. Even though in some regions Malls/Stores opened up, it was staggered and slow. Our focus is now on navigating the new normal by making the Company Digital, Agile and Resilient to all these challenges. We are strengthening our Omni-channel presence and capabilities. We have initiated a digital transformation journey from mid-July with a leading international consulting company on Omni to significantly improve the customer experience and thereby grow the business. During the lockdown, we continued to engage with our First Citizen Customers, Employees and surrounding communities using our personal shoppers and social media platforms, which ensured a healthy exchange of ideas, knowledge and information.

Our First Citizen Loyalty program has been recently revamped and now it is completely digital. This will ensure that we celebrate and capture moments that matter to them first.

Customer centricity continues to drive our business decisions. Special services that helped our customers shop from the safety and comfort of their homes were launched during this quarter and have been received very well. We serve our customers through our White Glove services and Endless Aisle to improve omni channel customer service experience. We have started Special initiative for serving our senior citizen customer through our 60+ साथी (Saathi) initiative. At the same time, we ensured complete follow through of the safety measures as stated by the Government, local authorities as well as the WHO; at all our stores, warehouses and office.

The company continues to focus on cost reduction initiatives and reducing monthly cash burn rate. The cost savings resulting from these initiatives on a consolidated basis for FY 2020-21, will be approximately 35% YoY. Of this Rs. 185 Crs. of savings has been realized in this quarter itself The Company is tracking favourably versus internal targets that were reset for the quarter in light of the pandemic in terms of financial performance, business recovery and on costs. Enhanced focus on cash conservation across the company to maintain short-term liquidity and balance sheet strength given the uncertain environment. The Company had a cash and Investments in Mutual Funds are at Rs.85 Crs. as of June 30, 2020 and further availed a Term Loan of Rs.75 Crs in July to deal with commitments in the coming quarters.

Shares of SHOPPERS STOP LTD. was last trading in BSE at Rs.175.05 as compared to the previous close of Rs. 164.9. The total number of shares traded during the day was 163231 in over 3383 trades.

The stock hit an intraday high of Rs. 180 and intraday low of 165.15. The net turnover during the day was Rs. 28586192.

Source : Equity Bulls

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