Consolidated net profit rose a muted 3.8% to ₹684.85 crore in the second quarter of FY26, amid high employee and finance costs.
DMart’s staff expenses surged 32% year-on-year to ₹376.83 crore in the second quarter of FY26, reflecting a persistent challenge for the retailer. Finance costs jumped nearly doubled to ₹34.96 crore during the quarter.
The Mumbai-based retailer added eight new stores during the July-September quarter, pushing its total count to 432 stores across India.
A key highlight of the quarter was a revival in growth from older stores. “Two years, and older DMart stores grew by 6.8% during Q2 FY26 as compared to Q2 FY25,” said Anshul Asawa, chief executive officer (CEO) designate of the company.
“Following the government’s recent announcement on GST reforms, we passed on the benefit of reduced GST rates to all our customers, wherever applicable,” he said.
Food and grocery products continued to dominate the retailer’s sales mix, contributing 57% of total revenue. General merchandise and apparel accounted for 19.7%, while non-food FMCG contributed 20.2%.
While the company reiterated its commitment to the ‘everyday low cost’ model, it did not share any forward-looking statements on growth or store additions.
E-commerce race
Meanwhile, the retailer ceased operations of its e-commerce service, DMart Ready, in five cities — Amritsar, Belgavi, Bhilai, Chandigarh, and Ghaziabad — during the quarter.
DMart Ready is DMart’s online grocery and essentials delivery platform. It allows customers to order products through its website or mobile app and either get them delivered to their homes or pick them up from designated DMart Ready pick-up points.
“We added 10 new fulfilment centres in our existing markets and continued to invest and deepen our presence in the large metro cities,” said its whole time director and CEO, Avenue E-Commerce Vikram Dasu.
CEO Neville Noronha had said in a post-earnings call with analysts on 30 July that DMart Ready’s growth is tied to the proximity of fulfilment centres. “We don’t have enough fulfilment centres. The more fulfilment centres we open closer to the markets of delivery, the more we will grow.”
CEO-designate Anshul Asawa is set to take over from Noronha in January next year. Noronha, who led DMart for over a decade, has indicated he will remain associated with the company in some capacity after his term ends.
“…there is a huge competition from the quick commerce. If you see the quick commerce upstart Swiggy and Blinkit, they have been going at a very fast rate,” said Pratik Prajapati, equity research analyst at Ambit Capital.
“In such a place, this DMart Ready is not able to turn around in such a way because they don’t have fulfilment centres like Blinkit and Swiggy have,” said Prajapati.
The entire effect of GST rate cut, income tax benefit, and festival buying will be seen in the second half rather than the first half, Prajapati added.
He said quarterly comparisons may be misleading because of the festival calendar shift—Navratri fell in October last year but in September this year—making the second-quarter results not directly comparable. While last year’s third quarter was exceptionally strong and the second was relatively weak, this year’s performance may be mixed and could be assessed on a full-year basis.
“We note there are 100+ cities already where one or more QC (quick commerce) companies are present and where no DMart stores are present, indicating fast-paced expansion of QC companies into tier 2/3 cities thus causing more competition for Dmart,” according to a Kotak analysts’ note dated 24 June.
With markets shut today, investor reaction to the earnings will be evident only when trading resumes on Monday.
