Why Did DMart's Q2 Net Profit Drop by 10%?
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Synopsis
In the latest financial report, DMart reveals a significant drop in net profits for Q2 FY26. Despite the decline, the retail giant showcases growth in year-on-year profits and revenue, highlighting resilience and strategic responses to market changes. Join us as we delve into the details of this financial update.
Key Takeaways
- Net profit for Q2 FY26 is Rs 746.55 crore, down 10% QoQ.
- Year-on-year profit growth of 5%.
- Revenue from operations at Rs 16,218.79 crore, up 2% QoQ.
- Opened 8 new stores in the last quarter.
- DMart maintains a strategy focused on value for customers.
New Delhi, Oct 11 (NationPress) Avenue Supermarts Ltd, which manages the retail chain DMart, announced on Saturday that its net profit for the second quarter of the current fiscal year (Q2 FY26) reached Rs 746.55 crore, reflecting a 10% decrease quarter-on-quarter (QoQ) from Rs 829.73 crore.
In contrast, the company's profit saw a 5% increase year-on-year (YoY) from Rs 710.37 crore.
Furthermore, DMart's revenue from operations was recorded at Rs 16,218.79 crore, representing an increase of nearly 2% QoQ from Rs 15,932.12 crore, and a YoY rise of over 15% from Rs 14,050.32 crore, as per its exchange filing.
The company also noted a slight increase of nearly 2.5% in total expenses, which amounted to Rs 15,248.89 crore for Q2 FY26, compared to Rs 14,855 crore in the previous quarter. Year-on-year, expenses rose 16%, up from Rs 13,143.56 crore in the same quarter last year.
According to the filing, earnings before interest, tax, depreciation, and amortization (EBITDA) for Q2 FY26 were Rs 1,230 crore, an increase from Rs 1,105 crore in the same quarter last year, with an EBITDA margin of 7.6% in Q2 FY26 compared to 7.9% in Q2 FY25.
Basic earnings per share (EPS) for the period were Rs 11.47, up from Rs 10.92 a year earlier, as reported by the company.
“Our revenue in Q2 FY26 increased by 15.4% compared to the previous year, and profit after tax (PAT) rose by 5.1% year-on-year. Stores that have been operational for two years or more saw a growth of 6.8% in Q2 FY26 compared to Q2 FY25,” stated Anshul Asawa, CEO-Designate of Avenue Supermarts Limited.
“In light of the government's recent GST reforms, we have passed the benefits of reduced GST rates on to our customers wherever applicable. During this quarter, we opened 8 new stores, bringing our total to 432 as of September 30, 2025,” Asawa added.
The Mumbai-based retailer DMart adheres to the everyday low cost-everyday low price (EDLC-EDLP) strategy, focusing on acquiring goods at competitive prices while ensuring operational and distribution efficiency to provide value for money to customers through competitive pricing.
Point of View
It's crucial to recognize the dual narrative of DMart's latest financial report. While the sequential drop in net profit raises concerns, the year-on-year growth reflects the company's resilience and strategic adaptations. The retail sector remains dynamic, and DMart's initiatives in response to market conditions will be pivotal in sustaining its growth trajectory.
NationPress
12/10/2025
Frequently Asked Questions
What caused DMart's net profit decline in Q2 FY26?
DMart's net profit decreased by 10% sequentially due to various market pressures and increased operational expenses.
How does DMart's current revenue compare to previous quarters?
DMart's revenue for Q2 FY26 stood at Rs 16,218.79 crore, which is a 2% increase quarter-on-quarter.
What is the EBITDA margin for DMart in Q2 FY26?
The EBITDA margin for DMart in Q2 FY26 was 7.6%, slightly down from 7.9% in Q2 FY25.
What strategic initiatives has DMart taken recently?
DMart has opened 8 new stores and passed on GST benefits to customers following recent government reforms.
What is the total number of DMart stores as of September 2025?
As of September 30, 2025, DMart operates 432 stores.
