|Particulars||Sep-20 Quarter||Growth (YOY)||Growth (QOQ)|
|Key Ratios||Sep-20 Quarter||Sep-19 Quarter||Jun-20 Quarter|
|Net Profit Margin||3.74%||5.39%||1.03%|
Key takeaways from the Sep-20 quarter results
- The numbers of D-Mart are surely showing a gradual move back to the pre-COVID levels. As a result, the sequential growth numbers are not too indicative as they show growth from a very small base. But on a yoy basis, the sharp fall in sales has impacted profits.
- The operating new cash flows for the first six months of the fiscal ending on Sep-20 stood at Rs.502 crore as compared to Rs.484 crore in the corresponding period in the previous fiscal year.
- If you compared the six months of the current fiscal with the six months of the last fiscal, the cash burn has been to the tune of Rs.160 crore. Clearly, the company has been falling back upon its existing cash to keep the operations running under COVID.
- In terms of risks, the company has stated that the full impact of the pandemic may not be yet visible in the numbers. Additionally, the new Code on Social Security 2020 could also impact the company’s contributions towards PF and gratuity and impact its profitability numbers in the coming quarters.
- During the second quarter ended Sep-20, the company added 6 stores while 2 were closed and converted into fulfilment centres for the ecommerce business. From a business standpoint, the mega expansion of Reliance Retail poses a big risk.