Shares of Shoppers Stop surged 20 per cent to hit a fresh 52-week high of Rs 335.85 on the BSE in Thursday’s intra-day trade after the company reported a strong operational performance in the July-September quarter (Q2FY22).
In the past one month, the stock has outperformed the market as it rallied 38 per cent, as compared to a 3.6 per cent rise in the S&P BSE Sensex. At 10:36 am, it was trading 16 per cent higher at Rs 326, against a 0.36 per cent decline in the benchmark index. The trading volumes on the counter jumped over five-fold, with a combined 3.3 million equity shares having changed hands on the NSE and BSE so far.
In Q2, Shoppers Stop reported an 116 per cent year-on-year (YoY) growth in revenue at Rs 631.60 crore against Rs 321 crore in the previous year quarter, on a favourable base.
The company said it witnessed strong recovery in demand after the second wave across the formats, with sales moving swiftly close to pre-pandemic levels in August and September. All the stores are now fully operational, with overall store operation days at 87 per cent for the quarter.
This led to sales growth of over 100 per cent and earnings before interest, tax, depreciation and amortization (Ebitda) growth by 387 per cent. The company posted Ebitda of Rs 138 crore against Rs 28 crore in Q2FY21. PBT losses narrowed down to Rs 4.1 crore from Rs 136.4 crore in the previous year quarter.
The management said the demand postponement triggered by the second wave of the pandemic witnessed a strong comeback in Q2. While July was muted with multiple lockdowns and Maharashtra completely closed, August and September witnessed a sharp recovery. The company has witnessed a strong volume growth of 59 per cent (overall value growth of 90 per cent), primarily led by Apparels, the management said.
The company achieved operational cost savings worth Rs 62 crore (vs. Q2FY20 levels), which reduced the quarterly cash burns, to a certain extent. The management indicated that the festive season has begun on a strong note and sales have recovered more than 100 per cent in the East, followed by North.
Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.
As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.
Support quality journalism and subscribe to Business Standard.