Avenue Supermart - Q1 FY22 Result Report - YES Securities

(Rating: ADD, TP: Rs3,820, Upside: 12.5%)

Offline business making quick recovery, increased efforts on online; rich valuations to limit upside

- View - We model in revenue/PAT CAGR of 34%/43% over FY24E, the highest growth in the large cap consumption space. Given limited absolute upside, we reiterate our ADD rating with a PT of Rs 3,820 based on 50x FY24E EV/EBITDA, implying 78x FY24 P/E.

- Result summary - Overall weak quarter with both revenue and margins impacted by lower operational hours during the quarter but traction is building up on all fronts with operations and inventory normalizing, supply chain stable and construction activity resuming. Revenue/EBITDA/PAT growth of 31%/103%/132% respectively.

- Topline - Revenue up 31% yoy to Rs 50.3bn on a low base (Still about 19% below 1QFY20 levels) despite much lesser hours of operations led by higher footfalls given lesser restrictions on personal mobility. 22 new stores opened post 1QFY21 also contributed to increased sales.

Shares of Avenue Supermarts Ltd was last trading in BSE at Rs. 3415 as compared to the previous close of Rs. 3396.5. The total number of shares traded during the day was 7506 in over 1301 trades.

The stock hit an intraday high of Rs. 3439.5 and intraday low of 3393.5. The net turnover during the day was Rs. 25608665.

Source : Equity Bulls

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