Avenue Supermarts operates a chain of hypermarkets called ‘DMart’. The super-popular chain of hypermarkets is the brainchild of Radhakishan Damani, a stock market trader and investor, who went on to become one of the most successful businessmen in India.
Born in a lower-middle class family in Bikaner (Rajasthan, India), Damani grew up in Mumbai. He dropped out of college to focus on his family ball-bearing business. After the death of his father, Damani quit the business and started taking keen interest in the stock market.
He became a stock broker and later started investing his own money in the market. He started practicing short-selling by being a part of the bear cartel – along with two other famous individuals Manu Manek Mundra and Rakesh Jhunjhunwala.
In 1992, when the stock market was hitting new highs – Damani and Jhunjhunwala were on the brink of bankruptcy when the Harshad Mehta scam broke out. The market crashed and Damani made a lot of money.
It was at this time that Damani and Jhunjhunwala quit shorting the market and went long (bullish) on India.
Damani started investing in consumer retail organizations. The knowledge of this sector helped him to take up a franchise of a cooperative department store called Apna Bazar. Damani did not find the business model appealing. This led to him starting his own venture – DMart was born.
It all started in 2002 when Damani started the first Dmart store in Powai, Mumbai.
Damani came up with a very unique strategy. DMart owned every single space they operated on rather than renting the place out. This helped the company save on recurring rental expense and the value of Dmart properties also increased exponentially.
Initially the growth was slow and this was purposely done. Damani wanted to perfect the Dmart model before going aggressive on opening new stores. This was in complete contrast to how ‘Big Bazaar’ under Kishore Biyani operated. The latter was aggressive, consistently loss-making and eventually failed.
The former (Dmart) was slow in the beginning, the business model was perfected and once it became profitable – Damani pushed Dmart into every nook and corner of the country. A true case of ‘slow and steady wins the race’.
Today, DMart has more than 300 stores stores, making it one of the largest retail chains in the country.
The credit for DMart’s success should be given to the sheer brilliance of inventory management. The management always prioritized product availability over presentation. Maximizing product offerings in a limited space ensured easy access for its consumers. Along with this, they streamlined operations by minimizing cash counters which in turn reduced employee costs.
The inventory stocking up has allowed DMart to price their product much lower than MRP which always meant that the return consumers were high. They also charged a sum to the suppliers called the slotting fee which helped the suppliers to put their products on display at their shelves.
In 2017, Damani decided to go public. He priced the IPO lower than the business deserved, he wanted to truly ‘leave something on the table’ for the investors.
The IPO was subscribed 104 times.
On March 21 2017, Avenue Supermarts was listed on the stock exchanges. The IPO price was ₹ 299 per share, and the stock listed above ₹ 600 – giving investors a gain of more than 100% on the listing day itself.
Dmart has given excellent returns to investors who invested in the couple of years after the company was listed.
The Dmart stock price hit an all-time-high of ₹ 5900 on October 18 2021. Since then, with strong competition from Reliance Retail and difficulty in maintaining the pace of growth (phases which every company goes through) – the stock has been in a steady downtrend.
DMart Share Price History
| Year | Share Price | Gain / Loss |
|---|---|---|
| IPO | ₹ 299.00 | |
| Listing | ₹ 640.00 | + 114.0% |
| 2017 | ₹ 1,180.00 | + 84.4% |
| 2018 | ₹ 1,607.70 | + 36.2% |
| 2019 | ₹ 1,838.20 | + 14.3% |
| 2020 | ₹ 2,765.65 | + 50.5% |
| 2021 | ₹ 4,669.70 | + 68.8% |
| 2022 | ₹ 4,070.75 | - 12.8% |
| 2023 | ₹ 4,060.00 | - 0.3% |
| 2024 | ₹ 3,610.00 | - 11.1% |
DMart Share Price Chart
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DMart Share Returns Calculator
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- During 2017, the share price of DMart was ₹ 299.
- If you had bought shares worth ₹ 2500 in 2017, you would have 84 shares today.
- At the end of 2024, the current value of your shares would be ₹ 301839.
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