Neutral V Mart Retail; target of Rs 3600: Motilal Oswal

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Motilal Oswal's research report on V Mart Retail

V-Mart Retail’s (VMART) revenue grew 17% YoY in 4QFY25, led by 8% SSSG and 12% store additions. EBITDA jumped ~70% YoY (in line) on account of gross margin improvement and lower losses in online segment.  Management has guided for 17-20% revenue growth in FY26E, driven by mid- to high-single digit SSSG and ~12% store area additions. We keep our FY26-27E revenue and EBITDA estimates broadly unchanged, though we significantly raise our PAT estimates, driven by the change in lease accounting. We model a CAGR of 18%/27% in revenue/EBITDA over FY25-27, driven by high-single-digit SSSG, ~65 (~12%) annual store additions and further reduction in LR losses.

Outlook

We value VMART at ~13x Mar’27E EV/EBITDA (~25x FY27E pre-IND AS 116 EBITDA) to arrive at our TP of INR3,600. We maintain Neutral on VMART.

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VMart Retail - 06052025 - moti