DMart Margins Under Strain Despite Revenue Growth

Avenue Supermarts, the operator of DMart, reported Q1 net profit of ₹7.73 billion, flat from last year, despite a 16% jump in revenues. The primary drag came from compressed EBITDA margins, which narrowed due to rising employee costs, increased energy usage, and higher competition from fast-delivery players like Zepto and Blinkit.

While consumer footfall remained strong across most metro and tier-2 outlets, inflation-sensitive households were seen gravitating toward lower-margin essentials, weighing on DMart’s blended gross profit. The company also indicated that real estate costs had risen in select markets, adding further pressure to operational expenses.

Analysts remain divided on DMart’s short-term outlook. Some believe its low-cost operational model will continue to attract loyal buyers, while others argue that tech-first quick commerce models are eating into its urban market share. Investors will closely track commentary on expansion pace, pricing strategy, and supply chain investments.