MUMBAI: With just hours to spare on Tuesday evening, Avenue Supermarts Ltd, the parent company of value retailer D-Mart, announced a flurry of store openings across the country, ending the financial year with 500 stores.
On Tuesday alone, the company added 12 stores across its stronghold of Maharashtra and Gujarat, and in newer regions where it is trying to build a stronger presence, including Tamil Nadu and Odisha. D-Mart opened 47 stores in March, a sharp increase from the 40-50 stores it typically has added annually over the past five years, according to its investor presentation.
The company opened 85 stores in FY26, the highest number added in a financial year. Shares of Avenue Supermarts surged more than 8% in morning trade on Wednesday, while the benchmark Nifty 50 was up more than 2.5%.
The change in pace is new for D-Mart, which traditionally opens new stores only after acquiring the land for it, generally through its subsidiary Nahar Seth & Jogani Developers Private Ltd. The company did not specify how many of the newly opened stores are leased or owned.
A spokesperson for D-Mart did not reply to Mint’s queries. Since its blockbuster listing in 2017, D-Mart has been trying to increase the pace of its store expansion by eschewing the buy-and-build model and leasing store space instead, including in malls.
However, the business of supermarkets continues to be under pressure as grocery buying moves to quick-commerce platforms Zomato’s Blinkit, Swiggy’s Instamart and Zepto, especially in bigger cities.
These platforms are also moving into tier-II and tier-III cities, and they are available in over 200 cities including Salem, Warangal, Haridwar and Ludhiana. D-Mart has expanded to these towns and cities as well. In March, it opened stores in cities including Dehradun, Cuddalore, Amritsar and Bareilly.
Quick commerce disruption
D-Mart remains vulnerable to the disruption from quick commerce as more than 57% of its revenue comes from packaged food, personal care and other staples, as per data from its December 2025 investor presentation.
“We are very, very clear about this, that great respect for what has happened in the quick commerce space,” former CEO Navil Noronha said on an analyst call last July, the last time D-Mart conducted a public earnings call. “I acknowledged this a couple of years back also, saying that this will become a very large business. So great stuff. They've done amazing work.”
Noronha added that the country, with its size of population, diversity and geographical space also creates a huge opportunity for an efficient brick-and-mortar business like D-Mart.
“So, we continue to remain very, very bullish on the brick-and-mortar business,” said Noronha, whose term ended on 31 January.
Noronha told analysts then that the company could have ideally scaled to 600-650 stores by FY26, adding that the management was squarely focused on acquiring more property for more stores faster.
“Long lease doesn't solve the problem of availability of high-quality or decent quality real estate,” he said.
Data from the company’s annual report for FY25 shows it is accelerating the land and property it owns. The company added freehold land worth ₹1,275 crore in FY24 and increased its investments by 32% to close FY25 with land worth ₹7,528.77 crore.
D-Mart has been struggling to stave off competition in grocery from online rivals. Earlier, it closed its online service D-Mart Ready in five cities as it moved the e-commerce business model from a ‘click-and-collect’ model to a home delivery service.
Supermarket rivals Reliance Retail and Tata’s Trent are also under pressure to expand their retail operations online and in physical store networks. Reliance’s JioMart operates across 5,000+ pin codes serviced by 3,000+ stores as of December and operates grocery-focused supermarket chains Smart and Fresh along with gourmet chain Freshpik.
Revenue growth
Reliance claims to be the country’s largest grocery retailer but does not break out the grocery business revenue. In 2020, it acquired supermarket rival Future Group, including its Big Bazaar chain, and in 2024, it bought out the India arm of European grocery wholesaler Metro AG.
Trent’s Star Bazaar operated 79 stores in December, having added only one store in the first nine months of FY26. In Q3 of FY26, Star Bazaar reported a marginal increase in revenue to ₹896 crore on account of store upgrades and consolidation, the company said in its latest investor presentation.
Compared to this, D-Mart reported revenue of over ₹18,100 crore in the third quarter, with like-for-like store growth down to 5.6% from 8.3% reported a year earlier.
In a note from January, analysts at brokerage firm Axis Securities said it was cautiously optimistic about the company’s like-for-like revenue growth, which remained slow because of over-reliance on selling low-margin consumer staples and a merely ‘healthy’ pace of store expansion. The analysts predicted the company would close this fiscal year with 50-60 new stores added–expectations that Avenue Supermarts exceeded.
Gradual recovery
“Looking ahead to FY27, D-Mart’s strategic emphasis on improving store productivity, enhancing profitability, and accelerating recovery in the General Merchandise & Apparel (GM&A) segment positions the company well for a gradual earnings recovery,” the analysts said in the report. “Its continued focus on passing on GST-related benefits to customers, along with stabilizing macroeconomic conditions and normalizing consumer demand, is expected to support volume-led growth.”
With GM&A a higher-margin category, any sustained pickup in discretionary spending could meaningfully improve overall profitability in FY27, the analysts said.
However, key risks include a slower-than-expected recovery in consumer demand, persistent pricing pressure in staples, and heightened competitive intensity in the value retail segment.
