D-Mart Q1 FY26 Results: Revenue Jumps 18%, But Profit Slips on Margin Pressure

Avenue Supermarts, the operator of the D-Mart retail chain, reported Q1 FY26 results that painted a mixed picture strong revenue growth of 18.2% YoY but a dip in net profit as margins took a hit. Total revenue stood at ₹13,754 crore, while net profit fell 2.4% YoY to ₹658 crore.

Key Financial Highlights :

• Revenue: ₹13,754 crore (↑18.2% YoY)

• Net Profit: ₹658 crore (↓2.4% YoY)

• EBITDA Margin: 8.9% vs 10.3% YoY

• Total Stores: 365 (added 12 in Q1)

Why Profits Fell Despite Higher Revenue

D-Mart’s sales momentum came from store expansion and robust demand for food and FMCG categories. However, the bottom line suffered due to several key reasons:

1. Weak General Merchandise & Apparel Sales

High-margin discretionary segments like general merchandise and apparel underperformed again. These categories, crucial for profit growth, continue to lag behind pre-COVID levels amid muted consumer sentiment.

2. Rising Operational Costs

The company’s expansion into new regions, along with higher logistics and employee costs, contributed to cost pressure. Despite operating on a lean retail model, D-Mart absorbed some inflationary impact to retain customer loyalty.

3. Margin Compression

EBITDA margin dropped from 10.3% to 8.9%, reflecting stress on operational efficiency even as revenues climbed.

Management Commentary : Growth Over Short-Term Profits

Neville Noronha, MD & CEO, commented:

He reiterated D-Mart’s long-term focus on profitable growth and disciplined expansion, with 12 new stores added in the quarter.

What’s Driving Revenue Despite Margin Pressures ?

The Indian retail sector continues to see strong footfalls in essential goods, and D-Mart remains a leader due to its:

• Competitive pricing

• Efficient inventory turnover

• High brand trust among value-conscious customers

However, until discretionary categories rebound, profitability will likely remain under pressure.

Final Word : D-Mart’s Tightrope Walk Continues

D-Mart’s Q1 FY26 earnings mirror a larger trend in the Indian retail sector—solid growth in essentials, sluggish recovery in discretionary, and rising cost pressures. For Avenue Supermarts to reignite bottom-line growth, a recovery in high-margin categories is essential. Until then, the company continues to balance scale with margin, betting on long-term consumer loyalty.

Sources :

Avenue Supermarts BSE Filings

Q1 FY26 Investor Presentation

Management Statements from Earnings Call