Shares of Avenue Supermarts Ltd., the parent of hypermarket chain DMart, are trading with losses of over 5% on Friday, April 4, following the release of its fourth-quarter business update.

The company reported standalone revenue growth of 16.6% year-on-year to ₹14,462.4 crore for the quarter. It also added 28 new stores during the period, bringing the total store count to 415.

However, implied same-store sales growth (SSSG) stood at just 3%, which appears to have disappointed investors.

Global brokerage firm Citi has maintained a ‘Sell’ rating on Avenue Supermart, with a price target of ₹3,350.

Citi has written in its note that Avenue Supermarts’ average revenue per store grew 3.1% year-on-year, compared to a 1–7% growth range seen over the previous four quarters.

The brokerage believes throughput continues to be impacted by an unfavorable product mix, driven by a slowdown in discretionary consumption, as well as store additions in smaller towns and rising competitive pressure from quick commerce players.

The company added 28 stores in the quarter and 50 in FY25, compared to 41 in FY24 and 40 in FY23.

Citi remains cautious, citing risks to same-store sales growth from increasing competition, store additions (and their impact on revenue growth), pressure on earnings from lower throughput and adverse product mix, and the high P/E multiple at which the stock currently trades.

Morgan Stanley has an ‘Underweight’ rating on Avenue Supermarts, with a price target of ₹3,260. The brokerage said that the five-year CAGR of 18.5% was higher than Q3FY24’s 18.2%, but lower than the average of 20% recorded across Q1FY24 to Q4FY24.

Net store additions stood at 28, compared to 10 in Q3FY24 and 24 in Q4FY24, marking the highest quarterly increase in store count and taking full-year net additions to 50.

Morgan Stanley estimated implied same-store sales growth (SSSG) for the quarter to be in the range of 8–9%.

Out of the 31 analysts that have coverage on Avenue Supermarts, 12 of them have a ‘Buy’ rating on the stock, nine of them say ‘Hold’, while the other 10 have a ‘Sell’ rating.

Shares of Avenue Supermarts are trading 2.93% lower on Friday at ₹4,036.05. The stock has risen 14% so far for the year.