DMart Parent Approves Up To ₹500 Cr Investment For E-Grocery Arm Despite Rising Losses

Avenue Supermarts, the operator of supermarket chain DMart, has approved an investment of up to ₹500 crore in its online grocery subsidiary, Avenue E-Commerce Ltd (AEL), as the retailer continues to build its DMart Ready business despite widening losses.

The approval was secured at the company's Annual General Meeting held on Wednesday, as per a report by The Economic Times (ET).

The fresh capital infusion could take Avenue Supermarts' total investment in AEL to nearly ₹2,000 crore, including ₹350 crore invested during FY26, the report said.

Avenue E-Commerce, which operates DMart Ready, reported a 17% increase in revenue to ₹4,094 crore in FY26 from ₹3,502 crore in the previous financial year. Its loss, however, widened to ₹307 crore from ₹247 crore in FY25, as per ET.

The company's latest annual report showed that it expanded its home-delivery operations, adding eight fulfilment centres and extending its service footprint to 18 cities during FY26. It also invested in technology, customer interfaces and delivery capabilities.

However, Avenue Supermarts has subsequently narrowed DMart Ready's operational focus to 11 cities, which account for the bulk of its online business.

"We made a conscious choice to double down on DMart Ready in 11 key cities where the vast majority of our online business comes from. We want our team to be laser-focused on proving that we can run a truly sustainable, profitable ecommerce model here," managing director and CEO Anshul Asawa told investors, as per ET.

The strategy was also reflected in the company's Q1FY27 management commentary. DMart Ready had discontinued operations in seven cities during the June quarter that made only a marginal contribution, leaving it operational in 11 cities as of June 30, 2026.

DMart Posts 11% Profit Growth In Q1

Avenue Supermarts reported an 11.3% year-on-year increase in consolidated net profit to ₹860.6 crore in the June quarter, compared with ₹773 crore a year earlier, according to the company's July 11 regulatory filing.

Revenue rose to ₹18,795 crore from ₹16,360 crore, while EBITDA increased 15.4% to ₹1,499 crore. EBITDA margin improved marginally to 8% from 7.9%, though PAT margin declined to 4.6% from 4.7%.

The company opened three stores during the quarter, taking its network to 503 stores as of June 30.

Separately, Avenue Supermarts informed stock exchanges on August 20 that it opened a new DMart store at Navsari, Amravati, in Maharashtra, taking its total store count to 507.

On the same day, the company also allotted ₹200 crore of commercial paper for 90 days at a coupon rate of 6.50%, with maturity scheduled for November 18, 2026. The unsecured instrument is proposed to be listed on the BSE and carries an ICRA A1+ rating.