V-Mart Retail Q3FY21 profit declined 17.77% to Rs 47.87 crore

Multi-brand retail chain V-Mart Retail on today reported the financial results of the company for the third quarter ended December 31, 2020 (Q3FY21). The company has reported a 17.77 per cent (year-on-year) decline in net profit at Rs 47.87 crore in the reported quarter. The company had posted a net profit of Rs 58.22 crore in the corresponding quarter of the financial year 2019-20 (Q3FY20).

Sequentially, the company has reported a loss of Rs 18.96 crore in the previous quarter ended September 30, 2020. The fall in revenues on a YoY basis was largely on account of the lag effect of the pandemic. However, the QOQ revenues have grown sharply indicating that the recovery process has already commenced.

Revenue from operations dropped 16.39 per cent to Rs 470.01 crore as against Rs 562.15 crore in the year-ago period. The company's revenue stood at Rs 175.50 crore in the September quarter.

The company in a statement said, "V-Mart said the Covid-19 pandemic has a significant impact on the business operations and financial results of the company for the quarter and period ended December 31, 2020." It further added, "With easing lockdown and opening of economic activities, the company believes that the company's operations will increase and expects the momentum to continue with an overall improvement in Covid-19 situation."

The company believes that the pandemic is not likely to impact the recoverability and carrying value of its assets comprising property, plant and equipment, intangible assets, right of use assets, investments, inventories, etc. Further, it has re-assessed the provision for inventory markdown and shrinkage, which is in line with the present situation and current indicators of future economic conditions.

The company also said that the combined effect of the festive season, marriage-related, and winter shopping and the lifting of lockdown bode well for an uptick in discretionary consumption, which is well reflected in the Company's strong quarter-on-quarter recovery momentum. The two largest markets of the Company, Uttar Pradesh and Bihar, have led the recovery, accounting for 66 per cent of sales in the third quarter.

Shares of V-Mart Retail Ltd. closed 21.70 points or 0.88 per cent higher at Rs 2,495.10 apiece on the BSE on Friday.