ICICI Direct has given Hold recommendation for Avenue Supermarts with a target price of Rs. 4900 in its research report issued on Oct 16, 2022
ICICI Direct’s research report on Avenue Supermarts
Avenue Supermarts (ASL) operates supermarket chain under ‘DMart’ brand with a core focus on value retailing. D-Mart, through its proven business model, has been able to maintain consistent profitability and remains an exceptional performer in its peer group. D-Mart has progressively enhanced its return ratios (RoIC: 20%+) despite being capital intensive (follows ownership model) • Robust store operating metrics (breakeven in 18-24 months of its operations and one of industry best revenue/sq ft: Rs 30000+).
Hence, we maintain HOLD recommendation on the stock. We value ASL at Rs 4900 i.e. 6x FY24E EV/sales.