Vishal Mega Mart Ltd
About the Company
Founded in 2001, Vishal Mega Mart Limited is a leading hypermarket chain catering to consumers across three key segments: apparel, general merchandise, and fast-moving consumer goods (FMCG). The company offers a mix of its own brands and third-party products, ensuring a diverse range of everyday essentials. Targeting middle- and lower-middle-income shoppers, it has built a widespread presence with 645 stores spanning 194 tier-1 cities and 451 tier-2 cities and beyond as of September 30, 2024. To enhance accessibility, Vishal Mega Mart provides direct hyper-local delivery through its website and mobile app for customers near its stores. The company follows a hub-and-spoke model to efficiently source products and manage in-store inventory.
Market Leadership:
VishalMart is among India’s top three offline-first diversified retailers by retail space (FY24).
Business Overview
Product Portfolio
Apparel: Includes in-house branded products such as t-shirts, shirts, denim, ethnic wear, innerwear & leisurewear for all age groups.
General Merchandise: Offers home appliances, crockery, furnishings, toys, travel products, footwear, and more.
FMCG: Comprises food (biscuits, noodles, spices), non-food items (diapers, sanitary pads), and staples
(oil, ghee).
Own Brands:
VMML has a diverse and growing portfolio of own brands across the apparel, general merchandise, and fast-moving consumer goods product categories. During Financial Year 2024, 19 of its brands recorded sales exceeding ₹1,000 million each, with six of its own brands recording sales exceeding ₹5,000 million each.
Third-Party Manufacturing
Vishal Mega Mart relies on third-party contract manufacturing, working with 839 vendors in FY24 under non-exclusive agreements. The company designs products in-house based on market trends and consumer preferences, focusing on affordability and quality. Vendors manufacture goods following company guidelines, with pre-determined pricing and stringent quality controls.
Hub & Spoke Model
The company employs a hub-and-spoke distribution model with:
• 1 central distribution hub
• 1 additional distribution centre
• 17 regional centres strategically located near demand areas.
The central hub supplies inventory to regional centres, which then distribute it to stores, ensuring efficient stock replenishment and minimal waste. This model supports the company’s 645-store network, enabling timely and cost-effective delivery across India. The Company follows an asset-light business model, leasing all its stores and distribution centres while sourcing products from third-party vendors or brands.
Franchise agreements:
As of September 30, 2024, two of its stores operated under third-party franchise agreements.
Multi-channel presence:
VMML sells its products not only through its stores but also through its mobile application and website2. They also provide direct hyper-local delivery through Vishal Mega Mart website and mobile application, to consumers located within close proximity to its stores7. As of September 30, 2024, VMML’s direct hyper-local delivery service, provided by its own employees, had 6.77 million registered users and was available in 600 stores across 391 cities in India.
Reaching New Cities and Towns:
VMML’s expansion strategy is venturing into cities with a population exceeding 50,000. Over the last two years, the company has made significant strides, increasing its store presence from 290 cities in March 2022 to 352 cities as of September 2024. By tapping into these growing urban centres, VMML aims to cater to a larger customer base and establish itself as a household name in affordable retail.
Strengthen Presence in Existing Cities and Towns:
There is significant potential to continue to enhance penetration within its existing cities and towns. Furthermore, as of September 30, 2024, VMML had more than 1 store in 64 cities in India as compared to 46 cities as of March 31, 2022.
Financial Report
Share Capital & Number of Employees
Share price and Volume (last 1 year):
Month and Year | December-2024 | January-2025 |
|---|---|---|
| Volume | 710000 | 1320000 |
Prev Close
₹99.44 Cr.
Sector
Trading
Market Cap
₹46550 Cr.
TTM PE
N/A
Sectoral PE Range
N/A
PE Remark
N/A
BSE
N/A
COMPANY TYPE | EVERGREEN |
|---|
| (IN INR CR) |
|---|
| (IN INR CR) |
|---|
Key Metrics
Market Cap
₹46,550 Cr.
Current Price
₹102
PE Ratio
103
D/E Ratio
0.26
ROCE%
11.4%
CWIP
₹₹38.3 cr Cr.
ROIC%
8.54%
Cash Conversion Cycle
15 day
ROE%
8.41%
PEG Ratio
N/A
Business Segment
Apparel & Fashion
Includes in-house branded products such as t-shirts, shirts, denim, ethnic wear, innerwear & leisurewear for all age groups.
General Merchandise & Household Goods
Includes kitchenware, home essentials, luggage, toys, and other non-food items.
FMCG & Grocery
Sells daily essentials, packaged foods, beverages, personal care products, and other fast-moving consumer goods.
Key Highlights & Management Guidance
Financial Performance:
In FY24, Vishal Mega Mart Limited reported revenue of ₹8,912 crore, growing 17.47% from ₹7,586 crore in FY23, driven by store expansion and a refined product mix. EBITDA rose 22% to ₹1,249 crore, supported by cost control, improved sourcing, and higher store sales. Net profit surged 44% to ₹462 crore from ₹321 crore, benefiting from strong revenue growth and cost efficiencies. Gross margin improved to 27.67% from 27.15%, while the EBITDA margin expanded to 14.01% from 13.45%, reflecting the company's effective cost management and strong pricing power.
Segmental Performance:
Strategic Growth Initiatives:
- Enhancing Sales Growth and Consumer Experience:
VMML is committed to driving same-store sales growth through multiple strategic initiatives. The company plans to expand its product portfolio by introducing new offerings across apparel, general merchandise, and fast-moving consumer goods (FMCG) while maintaining its price leadership. Additionally, VMML aims to enhance in-store experiences by improving store ambience, visual merchandising, and checkout processes. By leveraging technology and data obtained from its loyalty program, the company seeks to deepen consumer engagement and optimize sales strategies.
- Technology-Driven Omni-Channel Expansion:
To strengthen its market presence, VMML is focusing on expanding its hyperlocal services through its mobile application and website. This move aims to enhance accessibility for consumers by enabling direct-to-home deliveries and increasing convenience. Additionally, the company will continue to leverage consumer data to refine personalized recommendations and improve the overall omni-channel shopping experience.
- Brand Growth and Targeted Marketing Strategies:
A key focus area for VMML is the expansion of its own-brand portfolio, offering better value propositions to consumers. The company will introduce products aligned with evolving consumer preferences across various categories. Simultaneously, it aims to optimize its marketing expenditure by strengthening its store presence in existing markets and implementing cost-effective communication tools. By capitalizing on its loyalty database, VMML seeks to increase both the frequency of consumer visits and the average purchase value per transaction.
- Future expansion plans:
The company plans to open 80-100 new stores annually over the next few years with a continued focus on Tier-2 cities and beyond. This expansion strategy aligns with its goal of tapping into India’s burgeoning middle-class population while maintaining an asset-light approach. Moreover, Vishal Mega Mart aims to enhance its online presence through hyper-local delivery services and targeted marketing campaigns—initiatives designed to complement its brick-and-mortar operations.
Industrial Outlook
The industrial outlook for the trading sector remains positive, driven by key factors:
Digital Transformation: With the rise of e-commerce and online platforms, trading has become more efficient and accessible. The integration of technology, such as AI and data analytics, has enhanced inventory management, customer targeting, and market insights.
Globalization and Trade Liberalization: Expanding global trade agreements and cross-border e-commerce are boosting opportunities for international trade, allowing businesses to access wider markets.
Sustainability and Ethical Sourcing: There is an increasing focus on sustainable and ethical practices, with businesses and consumers prioritizing eco-friendly products and transparent supply chains.
Despite challenges like trade barriers, fluctuating global demand, and geopolitical risks, the trading sector is expected to grow steadily due to innovation, globalization, and evolving consumer preferences.
Financial Highlights
| PARTICULARS | Mar'2023 | Mar'2024 |
|---|---|---|
| Sales | ₹7,586 Cr | ₹8,912 Cr |
| OPM % | 14% | 14% |
| Net Profit | ₹321 Cr | ₹462 Cr |
Shareholding Pattern
Dec'2024 | |
|---|---|
| Promoters | 76.02% |
| FIIs | 6.58% |
| DIIs | 9.90% |
| Retailers | 7.51% |
Capsule’s View
Industrial Overview:
India’s retail market is experiencing rapid expansion, driven by a combination of rising disposable incomes, urbanization, and digital adoption. The sector is projected to grow at a CAGR of 9%, reaching an estimated ₹104-112 trillion by 2028. This growth is being fueled by increasing consumer spending, particularly in Tier 2 and Tier 3 cities, where modern retail formats are gaining traction.
The value-first retail segment, where Vishal Mega Mart operates, has seen significant demand due to a shift from unorganized to organized retail. Consumers are increasingly prioritizing affordability, convenience, and variety, making value-first retailers a preferred shopping destination. This shift is expected to continue as more customers opt for modern retail experiences over traditional mom-and-pop stores.
In terms of competition, Vishal Mega Mart is positioned among the top three offline-first diversified retailers in India. It faces competition from organized retail giants such as Reliance Retail and D-Mart, as well as growing e-commerce players like Amazon and Flipkart. The company’s ability to offer competitive pricing and an efficient supply chain plays a crucial role in maintaining its market share amidst this competitive landscape.