V-Mart Retail, India’s leading value fashion retailer, announced its audited financial results for the first quarter of FY20. For the first quarter, the company reported net revenue at Rs 4,530 million, up 25 percent year-on-year from Rs 3,612 million. Same store sales growth (SSSG) stood at 5.2 percent for the quarter.
The company registered the highest revenue growth in Uttar Pradesh, its largest state in terms of retail store presence. The key growth driver for this quarter was the holy month of Ramadan, leading to Eid, a festival widely celebrated by millions of families in geographies where V-Mart has a substantial presence. EBITDA, at Rs 578 million, stood at 12.8 percent for the quarter, suitably adjusted for Ind AS 116, which became applicable from April 01, 2019.
Continuing unabated its retail footprint expansion, the company opened 13 new stores in the Apr-Jun quarter, reaching a total area of 1.88 million sq.ft., and setting the pace for the year ahead. During the quarter, the company also closed down one store, which was an outcome of its ongoing rigorous store portfolio performance review and rationalization process.
Commenting on the company’s performance in Q1, Lalit Agarwal, CMD, said, “We remain bullish on the long-term market opportunity and V-Mart’s ability to drive accelerated expansion. Even though we are witnessing a bit of liquidity crunch in the economy and consumers holding back on spending, we were able to pull up sales and record impressive growth, particularly in the build-up to Eid in our key markets. This was possible because of a more focused fashion apparel and merchandize collection and promotional offers that connected well with our customers, who are always looking for better value. We also realize that, as customers, a large number of whom are millennials, become more aware of the latest fashion trends, our ability to offer value-fashion at a faster pace will be the key differentiator in a rapidly growing, but also more competitive market.”
With its sights firmly focused on accelerating long-term growth and sustained value creation for all stakeholders, the company is steadily making its organizational structure, processes and capabilities more robust and future-ready. The newly-implemented zonal retail structure and a thrust on in-store retail excellence measures, have started enabling a more responsive and agile decision-making culture, and enhanced customer experience.This was well-evidenced in the deft handling of one of the highest-evercustomer footfalls at its stores and an unprecedented sales performance during Eid, signifying a higher level of preparedness and growing process maturity in retail operations.
The company is further strengthening its customer-centricity mechanisms and processes – in product display and visual merchandizing, assortment selectionand marketing communication. Further, the company is enriching its already existing organization-wide data analytics architecture, to feed decision-enabling insights directly to store managers, regional heads and zonal heads. Technology adoption and upgradation across its planning, supply chain and logistics infrastructure is also underway, with the quarter witnessing some significant strides.
Looking ahead at the year, with the overall market and consumer spending outlook evenly poised on the expectations of a bountiful monsoon, the company is gearing up for the festive season comprising the triad of Durga Puja-Diwali-Chhath, the biggest shopping occasion in the annual calendar in its key markets.