Motilal Oswal's research report on Vishal Mega Mart
Vishal Mega Mart (VMM) is one of India’s largest offline-first value retailers, catering to a population of ~1b across the middle- and lowincome segments. VMM is a unique Indian retailer with: 1) a strong presence in tier 2+ cities (696 stores in 458 cities); 2) well-diversified exposure to key consumption baskets—Apparel (44%), General Merchandise (GM) & Fast-Moving Consumer Goods (FMCG; both ~28%); 3) a strong and affordable private brands portfolio (73% revenue share); and 4) one of the lowest cost structures in the industry. We believe VMM’s uniqueness provides it with a strong moat against intense competition from both offline and online value retailers.
Outlook
Initiate coverage on VMM with a BUY rating and a TP of INR165, premised on DCF-implied ~45x Sep’27E pre-INDAS 116 EV/EBITDA (implying ~31x Sep’27E reported EBITDA and ~69x Sep’27E P/E).
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