DMart, one of India’s largest retailers, saw a surge of 35% in its share during the last 12 months. This growth helped DMart to surpass a market cap of Rs 2 trillion. DMart is one of those rare firms that grew exponentially in the pandemic era. Radhakishan Damani, the founder of DMart and the 2nd richest man in India, has contributed immensely to the current success of DMart.
DMart Surges in Retail Industry
After the current growth of DMmart, Damani may enter in e-commerce sector to add more wealth to his bag. DMart net profit is increasing every quarter. In the recently concluded December quarter, the company saw a 16% growth in its net profit of Rs 447 crore. In the same quarter, the company also observed a 10% rise in its revenue.
In the December quarter, it had a total of Rs 7542 crore revenue. Out of this total revenue, the company received 52% revenue from grocery and food products. DMart also raised Rs 40.78 billion in FY 2020. It has spent approximately Rs 15 billion on that funding.
The company targets lower-middle, middle, and upper-middle-level income customers. It provides cost-effective products to woo the customers. DMart believes in a long and strong relationship with consumers rather than a short period profit-based partnership. The company creates a fan base of loyal consumers.
Kranthi Bathini, equity strategist at WealthMills Securities told Business Insider:
“DMart is strengthening its presence in the Western and Southern region. We are witnessing a complete transformation of retail – from unorganized to organized. I recently went to a DMart store and was amazed by the crowds. DMart stores have the quickest turnaround time to breakeven, ”
E-commerce Plans of DMart
DMart’s e-commerce vertical DMart Ready is becoming popular slowly.s also slowly gaining traction with its e-commerce vertical DMart Ready.
The company did not rush with the launch of DMart Ready. It started slowly in few major cities like Ahmedabad, Bengaluru, and Ahmedabad. The company is known for its offline stores. Damani also started Avenue E-commerce Limited to boost their chances in the digital environment. LinkedIn data also revealed that the company is actively hiring for its e-commerce startup.
The Axis Securities report said:
“DMART has established an extensive cluster-based distribution network comprising 220 stores and 225 DMART Ready stores as of Q2FY21. The cluster-based approach has reduced the distribution and inventory cost for the company in turn bettering margins, ”
Damani started Avenue Supermarts, the parent company of DMart, in the year 2020. He is also a well-known person in the
stock trading business. DMart is giving a tough competition to Reliance Retails. Damani is the second richest after Mukesh Ambani.