Avenue Supermarts Ltd’s lofty valuations suggest investors expect the moon from the retailer. Avenue runs the DMart supermarket chain of stores.
After the company announced its March quarter results on Saturday, Avenue’s shares now trade at a whopping 116 times financial year 2020 earnings.
Currently, the stock is about 6% away from its 52 week trading high seen in February on the NSE, indicating high investor optimism.
Even as March quarter results have been robust despite the covid-19 disruption, management commentary on the near future is cautious and that could well cap the gains in the stock, going ahead. “Our revenue for April was down by more than 45% as compared to April 2019.