Indian retailer Shoppers Stop's sales soar 7% in Q3 FY24

19 Jan '24

3 min read

Pic: Shoppers Stop

Insights

Shoppers Stop saw a 7 per cent sales increase to ₹1,207 crore in Q3 FY24, but profits fell with a gross margin drop to 39.7 per cent.
EBITDA, PBT, and PAT declined by 9 per cent, 42 per cent, and 43 per cent, respectively.
The company's First Citizen loyalty programme contributed 78 per cent to sales, with a membership base now at 9.7 million.

Shoppers Stop Ltd, a leading retail chain in India, has reported a sales growth of 7 per cent in the third quarter of fiscal 2024 (Q3 FY24), with sales rising from ₹1,132 crore in Q3 FY23 to ₹1,207 crore in Q3 FY24. However, this sales increase did not translate into profitability, as gross margin declined by 110 basis points from 40.9 per cent to 39.7 per cent.

The company's earnings before interest, taxes, depreciation, and amortisation (EBITDA) witnessed a decrease of 9 per cent, down from ₹240 crore in the previous year to ₹219 crore. Profit before tax (PBT) and profit after tax (PAT) also saw significant declines of 42 per cent and 43 per cent respectively, with PBT falling from ₹85 crore to ₹49 crore and PAT dropping from ₹62 crore to ₹35 crore, the company said in a press release.

On the strategic front, Shoppers Stop highlighted the performance of key areas in Q3 FY24. The First Citizen loyalty programme continues to be a cornerstone of the company's success, contributing 78 per cent to overall sales. Out of this, 65 per cent came from repeat members, while 13 per cent was attributed to new members. Premium Black Card members increased their contribution by 18 per cent year-on-year, representing 13 per cent of total sales. The company also added 191,000 members during the quarter, bringing the total membership base to 9.7 million.

The company's private brands also made a notable impact, generating sales of ₹189 crore, which accounted for 13 per cent of total sales and 19 per cent of apparel sales. Women's Indian wear within this segment reported a growth of 7 per cent, while kids wear under the brand ‘Stop’ grew by 8 per cent.

Furthermore, the company expanded its Intune store count by four during the quarter, reaching a total of 10 stores across six cities. The format maintained a full price sell-through rate of 65 per cent and continued to gain popularity for family shopping, with kids wear mix at 27 per cent. Plans are in place to add 14 more Intune stores in Q4 FY24, aiming for a total of 24 stores by the end of the fiscal, the release added.

“With considerable slowdown on the discretionary spending, we have demonstrated notable resilience in these tough conditions. Our company has delivered admirable financial results with a sales growth of 7 per cent despite muted consumer demand. And during the festive period, the sales grew by 9 per cent. Average transaction value grew by 6 per cent driven by premiumisation and items per ticket grew by 5 per cent,” said Kavindra Mishra, executive director and CEO.

Fibre2Fashion News Desk (DP)

More Shoppers Stop News... More Retail News - India...