Edelweiss Securities estimated its retail universe’s Q1FY19 revenue, EBITDA and PAT to grow 7.6 per cent, 15.2 per cent and 20.9 per cent YoY, respectively. Overall retail sector earnings are expected to grow in double digits for the quarter ended June 2018, but far lower growth than the year-ago period. In Q1FY19, there is a high base for most of the apparel retailers and Titan, thus growth this quarter will look slow.
Titan’s jewellery segment had strong base of 54 percent growth and hence growth would look soft, it feels. The report confirmed same-store-sales growth (SSSG) for most of apparel retailers is likely to be soft, except Trent. For V-Mart, Wonderla Holidays, it expects slight growth in average revenue per user (ARPU) across parks led by non F&B revenues.
On the margin front, for QSRs, it expects operating leverage to kick in. For companies like Shoppers Stop and ABFRL, pruning off loss making stores will be an added lever for margin expansion. Retail companies have also learnt the game well and are adopting Click & Mortar as the strategy to reciprocate to threats from online channel.