Avenue Supermarts Ltd.
Consumer Goods · NSE
52-week range
₹3,600 – ₹4,950
From 52w high
-11.1%
RSI (14)
51.2
vs SMA 50 / 200
↑ 50 · ↑ 200
Avenue Supermarts (DMART) trades at ₹4,402 with a trailing PE of 96x and a profit margin of 4.32%, reflecting a significant valuation premium relative to its thin-margin retail model. Q4 FY26 PAT and revenue each grew 19% YoY, yet return on equity of 12.94% has not exceeded 15% in any tracked year and the debt-to-equity ratio stands at 9.91 with a rising debt trend. The stock is above both its 50-DMA (₹4,175) and 200-DMA (₹4,145), with RSI at 51.
- ✓Revenue and earnings have compounded at approximately 19% annually over 5 years, delivering consistent double-digit top-line and bottom-line growth across cycles.
- ✓The stock sits above both its 50-DMA (₹4,175) and 200-DMA (₹4,145) with RSI at 51 — neither overbought nor oversold on the intermediate-term momentum picture.
- ✓Q4 FY26 results showed 19% PAT growth to ₹656 crore and 19% revenue growth, confirming the growth trajectory held through the most recent reported quarter.
- ✓Forward PE of 62x represents a discount of approximately 35% to trailing PE of 96x, reflecting market expectation of continued earnings expansion in coming periods.
- ✗D/E of 9.91 is substantially elevated for a consumer retail operation, with debt trend rising and FCF positive in only 2 of tracked years — indicating the business has consistently absorbed more capital than it has returned as free cash.
- ✗ROE of 12.94% has not crossed 15% in any year tracked (roeYearsAbove15 = 0), and a consistency score of 33/100 indicates the return profile is uneven relative to the headline 96x PE multiple.
- ✗A prominent broker initiated coverage in April 2026 citing valuation risk and a bear-case scenario of up to 50% downside, contributing to a news sentiment of 4 negative vs 2 positive across 8 recent articles.
- ✗DMART ranks 5th of 6 on PE (most expensive in the peer group on trailing earnings) and 4th of 6 on quality score (37) within Consumer Goods peers — expensive by sector comparison on most available metrics.
- ·Q4 FY26 results released May 2, 2026 reported consolidated PAT of ₹656 crore (+19% YoY) and revenue growth of 19%, in line with the 5-year compounding trend.
- ·Emkay Global initiated coverage in April 2026 with a negative rating on valuation grounds, flagging a bear-case scenario of up to 50% potential downside from prevailing prices — the coverage attracted follow-on reporting across multiple financial publications.
- ·The stock has risen 15.11% over the past 3 months and 9.88% over 12 months, with the price currently sitting 11.06% below its 52-week high and within ₹160 of the nearest resistance band at ₹4,563.
- ?Does the 19% revenue and earnings CAGR over 5 years reflect a durable structural advantage in value retail, or is it predominantly a function of store-count expansion that requires ongoing high capital deployment?
- ?How does DMART's D/E of 9.91 compare to its own historical range, and at what debt level has management historically signalled a capital-structure review?
- ?Given that ROE has not exceeded 15% in any tracked year despite a 96x trailing PE, what margin or asset-turn improvement would be required to justify the current valuation relative to sector peers trading at 48–88x?
- ?The bear-case analysis from Emkay projects up to 50% downside; what specific scenarios (quick-commerce penetration, margin compression, capex cycles) would need to materialise for that scenario to play out versus the base case of continued 19% growth?
PE
96.0
Forward PE
62.0
ROE
+12.9%
Profit margin
+4.3%
D/E
9.91
Dividend yield
—
Quality score
37/100
ROE 5y above 15%
0/5 yrs
FCF 5y positive
2/5 yrs
For informational purposes only. Not investment advice. VivaTrades is not a SEBI-registered Investment Adviser or Research Analyst. Market data sourced from public feeds; consult a registered adviser before any investment decision.Analysis generated 10 May 2026.