Key Takeaways
- DMart reports profit growth with a slight decline in margins
- Revenue rises 14.9% while expenses increase at a faster pace
- Store expansion continues with the total count reaching 503
Shares of Avenue Supermarts, which operates the DMart retail chain, declined up to 4.24% to ₹3,908 on the NSE on July 13 following the release of its DMart Q1 FY27 results. The market reaction came despite the company reporting growth in both revenue and profit, as margins showed a slight contraction during the quarter.
Earnings Growth Supported By Revenue Increase But Margins Narrow
Avenue Supermarts reported a consolidated net profit of ₹860.44 crore for the quarter ended June 30, 2026, marking an increase of 11.33% compared to ₹772.81 crore in the same period last year. Revenue from operations rose 14.9% to ₹18,794.53 crore, up from ₹16,359.70 crore in the corresponding quarter of the previous fiscal.
Total income for the quarter stood at ₹18,820.31 crore, reflecting a 14.9% increase. However, total expenses grew at a slightly higher rate of 15.11%, reaching ₹17,637.17 crore. This led to a marginal decline in profitability metrics.
The company reported a profit after tax margin of 4.6% in Q1 FY27, compared to 4.7% in Q1 FY26. The slight reduction in margin indicates rising cost pressures relative to revenue growth during the period.
Store Performance And Expansion Reflect Mixed Growth Trends
Operational performance across store formats showed variation. Stores that have been operational for more than 2 years recorded growth of 5.5% in Q1 FY27, compared to 7.1% in the same period last year. Growth in older stores located in major metropolitan areas remained flat during the quarter, while stores in non-metro regions continued to deliver stronger growth.
The DMart Shares Fall expanded its physical retail footprint by adding 3 new stores during the quarter, taking the total store count to 503. The continued store addition reflects ongoing investment in expanding presence across regions, particularly in markets with growth potential.
In the e-commerce segment, the company made adjustments to its DMart Shares Fall Ready operations. During the quarter, services were discontinued in 7 cities that contributed marginally to overall business performance. As of June 30, 2026, DMart Ready operates in 11 cities.
Avenue Supermarts continues to focus on retailing essential home and personal products across multiple states, including Maharashtra, Gujarat, Andhra Pradesh, Madhya Pradesh, Karnataka, Telangana, Chhattisgarh, NCR, Tamil Nadu, Punjab, and Rajasthan.
The Q1 FY27 performance reflects a combination of steady revenue growth and controlled expansion, alongside cost increases that impacted margins. For business owners and entrepreneurs, the results highlight the importance of balancing growth with cost management, particularly in retail environments where operating expenses can rise alongside expansion.
The DMart Shares Fall focus on store additions and selective optimization of its online operations indicates a strategy aimed at maintaining efficiency while scaling its presence. With 503 stores and continued adjustments across formats, Avenue Supermarts remains positioned within India’s organized retail segment, navigating demand trends across metro and non-metro markets.
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